September 17, 2019 / 6:54 AM / a month ago

EM ASIA FX-Most Asian currencies slip, Fed policy meeting in focus

    * S. Korean won loses most
    * Investors await Fed policy decision on Wednesday
    * Indian rupee, Indonesian rupiah face pressure from oil

 (Adds text, updates prices)
    By Shreya Mariam Job
    Sept 17 (Reuters) - Most Asian currencies weakened on
Tuesday against a stronger dollar, with the South Korean won
leading declines, as heightened Middle East tensions and the
U.S. Federal Reserve's  upcoming meeting curbed risk appetite. 
    Investors adopted a wait-and-watch stance ahead of the
Federal Reserve rate decision with the market largely expecting
a 25 basis point cut on Wednesday.
    Fed policymakers are divided over the need for further rate
cuts. In June, about half of policymakers expected a total of
two rate cuts this year while another half thought no rate cuts
would be appropriate.
    Meanwhile, the weekend attacks on Saudi Arabian crude
facilities, which fuelled U.S.-Iran tensions and buoyed oil
prices, continued to pressure the currencies of net oil
importers and risk sensitive economies.    
    "Most affected, (by the Saudi oil outage) it would seem, are
countries like Japan, Korea and India - big buyers of Saudi oil
plus high energy dependency ratios," analysts at ING wrote.
    The South Korean won declined the most among
Asian currencies, slipping 0.5%.
    The Indian rupee and the Indonesian rupiah
weakened 0.3% and 0.4%, respectively. Higher oil prices run the
risk of widening a country's trade deficit, exerting downward
pressure on its currency.
    On the other hand, the jump in crude prices continued to
support the greenback. Against a basket of six major currencies,
the dollar strengthened 0.4% on Monday. The currency
stood at 98.630 by 0552 GMT.
    The Malaysian ringgit also weakened 0.4% following a
public holiday on Monday.
    The Chinese yuan weakened 0.3% against the
dollar. Data showed that China's new home prices grew at their
weakest pace in nearly a year in August.
    This followed weak August factory data on Monday that showed
signs of increasing weakness in an economy which has been
bruised by the trade war and soft domestic demand.
    Meanwhile, the People's Bank of China partially rolled over
loans but kept the lending rate unchanged, a sign it is willing
to maintain adequate credit to support a slowing economy but is
wary of excessive stimulus.

    The following table shows rates for Asian currencies against
the dollar at 0604 GMT.
 Change on the day at   0604 GMT                  
 Currency               Latest bid  Previous day  Pct Move
 Japan yen              108.200     108.12        -0.07
 Sing dlr               1.376       1.3748        -0.09
 Taiwan dlr             30.971      31.002        +0.10
 Korean won             1189.300    1183.1        -0.52
 Baht                   30.570      30.5          -0.23
 Peso                   52.270      52.31         +0.08
 Rupiah                 14095.000   14035         -0.43
 Rupee                  71.813      71.59         -0.31
 Ringgit                4.178       4.163         -0.36
 Yuan                   7.088       7.0685        -0.28
 Change so far in 2019                            
 Currency               Latest bid  End 2018      Pct Move
 Japan yen              108.200     109.56        +1.26
 Sing dlr               1.376       1.3627        -0.97
 Taiwan dlr             30.971      30.733        -0.77
 Korean won             1189.300    1115.70       -6.19
 Baht                   30.570      32.55         +6.48
 Peso                   52.270      52.47         +0.38
 Rupiah                 14095.000   14375         +1.99
 Rupee                  71.813      69.77         -2.84
 Ringgit                4.178       4.1300        -1.15
 Yuan                   7.088       6.8730        -3.03

 (Reporting by Shreya Mariam Job in Bengaluru
Editing by Jacqueline Wong
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