November 22, 2017 / 5:33 AM / 4 months ago

EM ASIA FX-Most Asian currencies firmer as dollar sags on dovish Yellen comments

 (Adds text, updates prices)
    Nov 22 (Reuters) - Asian currencies firmed on Wednesday on
the back of a weakened U.S. dollar after Federal Reserve chair
Janet stuck by her prediction that U.S. inflation would rebound
but added she was "very uncertain" of it happening.
    "She mentioned quite specifically that inflation
expectations could be drifting lower, which is something she has
not spoken about before," said Nizam Idris, head of strategy,
fixed income and currencies at Macquarie Bank.
     "Basically, she has cast some doubt over the Fed’s previous
view that the low inflation that we see currently is transitory
in nature." Idris said.
     "So, both those twists in her opinions in my view are
dovish and therefore I think the dollar has weakened from those
    The dollar index, which measures the greenback
against a basket of six major currencies, fell from a one-week
high of 94.165 overnight.
    Among Asian currencies, the Malaysian ringgit
strengthened over 0.4 percent after central bank Governor
Muhammad Ibrahim said the  currency was "far from relecting its
fair value", signalling a desire for the exchange rate to build
on its recovery from a sharp selloff last year.    
    "BNM (Bank Negara Malaysia) would prefer a stronger ringgit
to take the edge off rising prices given their latest forecast
suggesting inflation wll be at the upper end of the forecast
range," Stephen Innes, head of trading APAC at Oanda, wrote in a
note on Wednesday.
    Malaysia's annual inflation rate is likely to moderate to 4
percent for October from 4.3 percent in September, according to
a Reuters poll.
    The Taiwanese dollar strengthened for a second day,
gaining 0.3 percent to 29.962 to the greenback, its highest in
the more than two months.
    Taiwan's benchmark stock index rose 1 percent to its
highest level in over 27 years, propped up by information
technology stocks.
    China's yuan firmed 0.2 percent while the Indian
Rupee strengthened 0.2 percent. 
    The Singapore dollar traded marginally higher ahead
of gross domestic product (GDP)and inflation data on Thursday. A
poll by Reuters indicates the Monetary Authority of Singapore's
(MAS) core inflation measure in October likely rose 1.5 percent
from a year earlier.

    Thailand's customs-cleared trade data released on Wednesday
showed exports climbed 13.1 percent in October from a year
earlier after rising 12.2 percent in September, beating the
median forecast of an 11.8 percent rise from economists polled
by Reuters.            
    However, imports zooming 13.5 percent in October resulted in
a trade surplus of $0.21 billion for the month, well below the
forecast of $1.3 billion.    
    The Baht gained 0.12 percent to 32.74 after the data were
    The won led the gains in Southeast Asia, gaining 0.45
percent to 1,091 against the dollar, on track for its second
session of gains. 
    "BoK (Bank of Korea) has kept its policy rate unchanged amid
steady growth and benign inflationary pressure. Nevertheless,
the emergence of a dissenter calling for a rate hike as well as
more hawkish comments from the governor in the latest meeting
has signaled that the next move will be a hike," wrote Vishnu
Varathan, head, economics & strategy at Mizuho Bank in Singapore
in a note. 
    The BoK is scheduled to hold a monetary policy meeting on
Nov. 30.
 CURRENCIES VS U.S. DOLLAR                              
 Change on the day at 0459 GMT                          
 Currency                     Latest bid  Previous day  Pct Move
 Japan yen                    112.21      112.43        +0.20
 Sing dlr                     1.3539      1.3542        +0.02
 Taiwan dlr                   29.962      30.060        +0.33
 Korean won                   1091        1095.8        +0.49
 Baht                         32.730      32.78         +0.15
 Peso                         50.650      50.74         +0.18
 Rupiah                       13521       13532         +0.08
 Rupee                        64.75       64.89         +0.20
 Ringgit                      4.121       4.138         +0.41
 Yuan                         6.621       6.6305        +0.14
 Change so far in 2017                                  
 Currency                     Latest bid  End 2016      Pct Move
 Japan yen                    112.21      117.07        +4.33
 Sing dlr                     1.3539      1.4490        +7.02
 Taiwan dlr                   29.962      32.279        +7.73
 Korean won                   1091        1207.70       +10.75
 Baht                         32.730      35.80         +9.38
 Peso                         50.650      49.72         -1.84
 Rupiah                       13521       13470         -0.38
 Rupee                        64.753      67.92         +4.89
 Ringgit                      4.121       4.4845        +8.82
 Yuan                         6.621       6.9467        +4.92

 (Reporting by Aaron Saldanha in Bengaluru; Editing by Kim
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