December 21, 2018 / 5:56 AM / 6 months ago

EM ASIA FX-Most Asian currencies firm after Fed softens rate hike view

    * Korean won strengthens 0.5 pct
    * Rupee on track to gain about 2 pct this week

 (Adds text, updates prices)
    By Niyati Shetty
    Dec 21 (Reuters) - Most Asian currencies edged up as the
dollar languished near a one-month low on Friday after the U.S.
Federal Reserve softened its rate hike outlook against the
backdrop of a slowing economy.
    Leading the region's gainers, the Korean won
strengthened 0.5 percent and was also on track for weekly gains.
    The greenback slumped after the Fed on Thursday signalled
fewer rate hikes over the next few years than it previously
projected, which helped push long-term U.S. Treasury yields to
near nine-month lows.
    The Taiwan dollar firmed 0.2 percent and was slated
for marginal gains this week. 
    The island's central bank kept its policy rate on hold on
Thursday, amid fears that persisting global trade tensions would
dent its export-oriented economy.
    Also clocking slight gains against the greenback was the
Philippine peso and the Singapore dollar.
    The Indian rupee, on the other hand, weakened as much 0.5
percent in early trade as oil prices rebounded on Friday after
tumbling in the last session, on signs OPEC's production cuts
that start next month will be deeper than expected. The rupee
had pared some losses by 0500 GMT.
    However, the rupee was on track to gain about 2
percent this week as declining oil prices early in the week
buoyed investor sentiment. 
    India and Indonesia are net oil importing countries with
huge current account deficits.
    The Indonesian rupiah was also marginally lower
against the greenback, but was poised for about 0.6 percent of
weekly gains.
    The country's central bank on Thursday kept its benchmark
interest unchanged, though it reasserted it would act to defend
the exchange rate when needed.
    
    CHINESE YUAN STUMBLES 
    The yuan was marginally weaker on Friday, but was
on track to gain about 0.3 percent this week. 
    The United States and three allies chastised China for
economic espionage on Thursday, driving up tensions as U.S.
prosecutors indicted two Chinese nationals linked to a spy
agency on charges of stealing confidential data.
    Meanwhile, China's central bank on Wednesday rolled out a
targeted policy tool to inject liquidity in the market, in the
latest step to support the slowing economy amid a trade dispute
with the United States.
    Mizuho Bank said in a note to clients that the "market
speculates whether the central bank will tilt more towards a
more flexible approach, away from its previous prudence, against
the backdrop of growing downside risks." 
    
    The following table shows rates for Asian currencies against
the dollar at 0500 GMT.
    CURRENCIES VS U.S. DOLLAR
    
 Currency                 Latest bid  Previous day  Pct Move
 Japan yen                111.380     111.28        -0.09
 Sing dlr                 1.369       1.3705        +0.12
 Taiwan dlr               30.769      30.843        +0.24
 Korean won               1122.600    1127.8        +0.46
 Baht                     32.660      32.67         +0.03
 Peso                     52.990      53.12         +0.25
 Rupiah                   14487.000   14465         -0.15
 Rupee                    69.850      69.70         -0.21
 Ringgit                  4.177       4.176         -0.02
 Yuan                     6.890       6.8835        -0.09
                                                    
 Change so far in 2018                              
 Currency                 Latest bid  End 2017      Pct Move
 Japan yen                111.380     112.67        +1.16
 Sing dlr                 1.369       1.3373        -2.30
 Taiwan dlr               30.769      29.848        -2.99
 Korean won               1122.600    1070.50       -4.64
 Baht                     32.660      32.58         -0.24
 Peso                     52.990      49.93         -5.77
 Rupiah                   14487.000   13565         -6.36
 Rupee                    69.850      63.87         -8.56
 Ringgit                  4.177       4.0440        -3.18
 Yuan                     6.890       6.5069        -5.56
 

 (Reporting by Niyati Shetty in Bengaluru
Editing by Jacqueline Wong)
  
 
 
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