November 20, 2018 / 4:56 AM / 6 months ago

EM ASIA FX-Most Asian currencies in tight range; Indian rupee hits 11-week high

 (Adds text, updates prices)
    By Aby Jose Koilparambil
    Nov 20 (Reuters) - The Indian rupee climbed to a
11-week high on Tuesday after a central bank board meeting that
indicated an easing in tensions between the Reserve Bank of
India (RBI) and the government following a public fallout that
rattled investors.
    Other Asian currencies traded in thin ranges, swinging
between losses and gains against the dollar.
    The rupee firmed as much as 0.5 percent and was the only
significant gainer on the day, with investors in most of the
regional emerging currency markets remaining cautious over
global growth worries and an overnight sell-off in the U.S.
equities market.
    Emerging markets, particularly in Asia, are also keeping a
close watch on the Sino-U.S. rhetoric ahead of a much-awaited
meeting between the presidents of the world's largest economies
in the sidelines of the G-20 summit in Argentina at the end of
this month.
    The Philippine peso, the Chinese yuan, the
Korean won and the Taiwanese dollar flitted
in and out of positive territory.
    The Thai baht declined as much as 0.3 percent as
weak GDP data on Monday continued to weigh on investor
    The Indonesian and Malaysian currency markets were closed on
Tuesday for a public holiday.
    Even a softer dollar, which generally benefits the basket of
emerging market currencies in Asia, was not enough to boost 
sentiment in most regional markets.
    The dollar hit a near two-week low against its peers on
Tuesday, with sentiment soured by Federal Reserve caution on the
global outlook and weak data at home, leading markets to suspect
the U.S. tightening cycle may not have much further to run.

    Overnight, New York Fed President John Williams noted that
the Fed is not on a pre-set course and will adjust monetary
policy to keep the economy strong with low inflation.
    The rupee firmed to as much as 71.288 to the dollar, its
highest level since Sept. 4, as the outcome of Monday's RBI
board meeting suggested both the central bank and the government
were keen to reduce recent tensions which had raised questions
about the RBI's future autonomy.      
    After the marathon meeting, the RBI's board advised it will
act to support small businesses and give banks more time to step
up capital norms, following weeks of pressure from the federal
government to spur lending ahead of elections.
    The RBI board also decided to form an expert panel to look
into whether its reserves are adequate, in light of a push from
New Delhi for access to surplus reserves built up by the central
    "The Reserve Bank of India signalled a compromise with the
government on key regulatory aspects... Easing tensions between
the RBI and the government is likely to be positive for INR
assets, particularly as the central bank is seen to retain its
operational autonomy," said Radhika Rao, economist at DBS Group
Research in a note.
    The following table shows rates for Asian currencies against
the dollar at 0452 GMT.
 Currency                     Latest bid  Previous day  Pct Move
 Japan yen                    112.500     112.54        +0.04
 Sing dlr                     1.371       1.3715        +0.04
 Taiwan dlr                   30.901      30.906        +0.02
 Korean won                   1128.000    1128.6        +0.05
 Baht                         32.970      32.89         -0.24
 Peso                         52.550      52.57         +0.04
 Rupee                        71.355      71.64         +0.40
 Yuan                         6.943       6.9415        -0.02
 Change so far in 2018                                  
 Currency                     Latest bid  End 2017      Pct Move
 Japan yen                    112.500     112.67        +0.15
 Sing dlr                     1.371       1.3373        -2.46
 Taiwan dlr                   30.901      29.848        -3.41
 Korean won                   1128.000    1070.50       -5.10
 Baht                         32.970      32.58         -1.18
 Peso                         52.550      49.93         -4.99
 Rupiah                       14585.000   13565         -6.99
 Rupee                        71.355      63.87         -10.49
 Ringgit                      4.187       4.0440        -3.42
 Yuan                         6.943       6.5069        -6.28
 (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by
Kim Coghill)
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