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EM ASIA FX-Malaysian ringgit up at fresh year high, won firms
November 21, 2017 / 6:31 AM / a month ago

EM ASIA FX-Malaysian ringgit up at fresh year high, won firms

 (Adds text, updates prices)
    By Susan Mathew
    Nov 21 (Reuters) - Malaysia's ringgit and South Korea's won
edged up on Tuesday, buoyed by expectations of tighter monetary
policy after recently strong economic growth while most Asian
currencies traded sideways.
    Investor risk appetite was largely subdued, with the euro
pressured by political deadlock in Germany. The euro rose
slightly after dropping in the previous session as German
coalition government talks collapsed on the pro-business Free
Democrats withdrawing from negotiations.
    The dollar index was lower but still near a one-week
high against its peers. 
    Meanwhile, U.S. Republicans are not expected to push major
tax cuts through Congress this year, according to a majority of
economists in a Reuters poll, who were also sceptical that tax
reform would provide a significant boost to the economy.

    "People are trying to take back their bets. The U.S. dollar
has been coming under pressure because of the tax view, and now
along with this week being short one on holiday there might be
some profit taking," said Lee Jin Yang, macro research analyst
for Aberdeen Asset Management in Singapore. 
    U.S. markets will be closed on Thursday due to the
Thanksgiving holiday.
    "But Asian currencies have been relatively unaffected by
what has been going on in the U.S. and that has leant support to
the currencies."
    Gains in the region were led by the won, ringgit
 and Taiwan dollar.
    The ringgit and the Indian rupee were each more
than 0.12 percent higher. Positive economic growth data from
Malaysia and a Moody's upgrade on India, have kept the sentiment
on these currencies buoyant. The ringgit hit fresh more than
one-year highs on Tuesday. 
    The Thai baht was the biggest loser in the region,
down 0.2 percent after having led gains in the previous session
on positive economic growth data.
    Nath Wongasaroj, corporate treasury trader at Mizuho Bank,
attributed the baht's move lower to "short covering on corporate
demand approaching month-end."
      
    WON AND TAIWAN DOLLAR
    The won was up 0.3 percent, its fifth gaining session in
six.
    "The South Korean won's recent strength could be attributed
to rising odds of a central bank rate hike in November, easing
geopolitical tensions on the Korean Peninsula and flattened U.S.
Treasury yield curves," Qi Gao, FX Strategist (EM Asia) at
Scotiabank said in a note.
    The market consensus is that the BOK will raise interest
rates for the first time in more than six years at its Nov. 30
meeting after the economy achieved its fastest growth for seven
years in the third quarter.
    On the equity front, the South Korean benchmark equity index
 was up 0.2 percent, while Taiwan's stock index
rose 1.1 percent. The Semiconductor indices for both nations
 and, respectively, were up as much as over 1
percent each. Overnight, Wall Street was boosted by chipmakers.

    The Taiwan dollar was up as much as 0.2 percent,
its highest in two months. 
    Data on Monday showed that Taiwan's export order growth was
higher than expected in October, aided by global demand for tech
gadgets. Strong exports have raised confidence the government
can easily meet its upwardly revised 2017 economic growth
forecast of 2.15 percent, giving the central bank room to keep
interest rates steady. 
    
    CURRENCIES VS U.S. DOLLAR
 Change on the day at 0534 GMT                      
 Currency                 Latest bid  Previous day  Pct Move
 Japan yen                112.54      112.62        +0.07
 Sing dlr                 1.3559      1.3566        +0.05
 Taiwan dlr               30.063      30.102        +0.13
 Korean won               1097        1100.6        +0.37
 Baht                     32.830      32.754        -0.23
 Peso                     50.800      50.79         -0.02
 Rupiah                   13542       13533         -0.07
 Rupee                    65.02       65.11         +0.13
 Ringgit                  4.142       4.148         +0.14
 Yuan                     6.636       6.6300        -0.09
                                                    
 Change so far in 2017                              
 Currency                 Latest bid  End 2016      Pct Move
 Japan yen                112.54      117.07        +4.03
 Sing dlr                 1.3559      1.4490        +6.87
 Taiwan dlr               30.063      32.279        +7.37
 Korean won               1097        1207.70       +10.14
 Baht                     32.830      35.80         +9.05
 Peso                     50.800      49.72         -2.13
 Rupiah                   13542       13470         -0.53
 Rupee                    65.023      67.92         +4.46
 Ringgit                  4.142       4.4845        +8.27
 Yuan                     6.636       6.9467        +4.69
 
 (Reporting by Susan Mathew in Bengaluru; Editing by Jacqueline
Wong)
  
 
 

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