January 22, 2018 / 5:47 AM / a year ago

EM ASIA FX-Most Asian currencies slip as dollar recovers after U.S. govt shutdown

 (Adds text, updates prices)
    By Christina Martin
    Jan 22 - Most emerging Asian currencies edged lower on
Monday as the dollar drew support from higher U.S. bond yields
and managed to hold above three-year lows, after pulling back
slightly on news of the U.S. government shutdown. 
    The shutdown took effect at midnight on Friday after
Democrats and Republicans, locked in a bitter dispute over
immigration and border security, failed to agree on a
last-minute deal to fund government operations.
    The dollar's index against a basket of major
currencies initially dipped to hit 90.155 but was last up 0.07
percent as the 10-year Treasury yield extended
Friday's rise to touch a 3-1/2-year high.
    "Currently, the market optimism is that the (U.S.
government) shutdown is going to be sorted out soon, and that's
the reason the dollar did not dip too much," said a Thai bank
forex strategist. 
    "The markets believe that the dollar has been depreciated
too much and will be able to rebound in short term."
    The Korean won dropped as much as 0.4 percent,
while the Philippine peso fell to its lowest in nine
weeks, also down as much as 0.4 percent.
    The won and the peso were the biggest losers in the region. 
    The Indonesian rupiah marked its biggest intraday
percentage loss in three weeks as it slipped as much as 0.3
percent, ending two straight sessions of gains. 
    The Indian rupee dipped as much as 0.2 percent,
while China's yuan broke a six-session gaining
streak, posting its biggest intraday percentage loss in more
than a week. 
    The Taiwan dollar rose as much as 0.8 percent and
hit a five-year high, on track to gain for a second consecutive
    The Thai baht, the Singapore dollar and the
Malaysian ringgit all traded flat. 
    China's yuan eased slightly against the U.S.
dollar on Monday when the greenback consolidated after
sustaining losses on news of the U.S. government shutdown.
    The People's Bank of China (PBOC) recalibrated the template
for daily yuan fixings recently to nullify a discretionary
counter-cyclical factor it introduced into the formula last year
to curb the currency's decline.
    The PBOC set its official yuan midpoint at 6.4112 per dollar
prior to market opening on Monday, its highest in more than two
    In the spot market, the onshore yuan opened at
6.4080 per dollar and was changing hands at 6.4078 at midday, 48
pips weaker than the previous late session's close.
    Unlike regional peers that fell as the dollar recovered some
of its earlier losses, Taiwan's dollar hit its highest
since January 25, 2013, climbing as much as 0.8 percent. 
    Taiwan's export orders are expected to have risen in
December at a faster pace than the previous month and clocked a
17th straight month of gains, as demand for the island's
technology products remained robust, a Reuters poll showed.

    Taiwan's export data is due later in the day. 
    The following table shows rates for Asian currencies against
the dollar at 0513 GMT.
 Currency                     Latest bid  Previous day  Pct Move
 Japan yen                    110.790     110.76        -0.03
 Sing dlr                     1.321       1.3207        -0.05
 Taiwan dlr                   29.217      29.430        +0.73
 Korean won                   1069.000    1065.9        -0.29
 Baht                         31.870      31.86         -0.03
 Peso                         50.890      50.72         -0.33
 Rupiah                       13341.000   13312         -0.22
 Rupee                        63.913      63.85         -0.11
 Ringgit                      3.939       3.936         -0.08
 Yuan                         6.408       6.4030        -0.07
 Change in 2018                                         
 Currency                     Latest bid  End 2017      Pct Move
 Japan yen                    110.790     112.67        +1.70
 Sing dlr                     1.321       1.3373        +1.20
 Taiwan dlr                   29.217      29.848        +2.16
 Korean won                   1069.000    1070.50       +0.14
 Baht                         31.870      32.58         +2.23
 Peso                         50.890      49.93         -1.89
 Rupiah                       13341.000   13565         +1.68
 Rupee                        63.913      63.87         -0.07
 Ringgit                      3.939       4.0440        +2.67
 Yuan                         6.408       6.5069        +1.55
 (Reporting By Christina Martin in Bengaluru; Editing by Eric
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