January 11, 2018 / 5:55 AM / in a year

EM ASIA FX-Most currencies firm; Thai baht at near 3-1/2-year high

    * Most Asian currencies firm on weaker U.S. dollar
    * Dollar falls on reports of China slowing U.S. debt buys
    * Malaysian ringgit and Thai baht gain most among peers

 (Adds text, updates prices)
    By Aditya Soni
    Jan 11 (Reuters) - Most emerging Asian currencies firmed
slightly on Thursday, as the U.S. dollar lost steam overnight
after a report that China was ready to slow or halt its U.S.
Treasury purchases, pushing up yields.
    Chinese officials reviewing the country's vast foreign
exchange holdings have suggested slowing or halting purchases of
U.S. Treasuries, Bloomberg News reported on Wednesday.
 The report sent U.S. Treasury yields to 10-month
highs and the dollar lower.
    Earlier this week, the greenback was dented by the Bank of
Japan's announcement that it would buy less of the long-dated
bonds, triggering speculation that the central bank may wind
back its monetary stimulus this year. 
    However, gains in regional currencies on Thursday were
capped by a fall in global sentiment, as investors reassessed
risk levels and Asian shares fell due to concerns over rising
U.S. trade protectionism.
    "AXJs (Asia ex-Japan currencies) are mostly higher as USD
remains rattled on UST (U.S. Treasuries) concerns," Saktiandi
Supaat, an analyst at Maybank, wrote in a research report. 
    "Risk-off sentiments this morning, which is sparking a
sell-off in equities, could weigh on the Asian currencies and
limit upside intraday." 
    The Thai baht strengthened 0.3 percent to a near
three-and-a-half year high, while the Indonesian rupiah
firmed slightly.
    On the other hand, the Chinese yuan weakened 0.1 percent.
Data on Wednesday showed producer prices in the world's second
largest economy rose at their slowest pace in 13 months in
December.
    "China inflation data was a bit damp, and that has given
traders cause for thought," said Stephen Innes, head of trading
Asia-Pacific at Oanda.
    
    MALAYSIAN RINGGIT 
    The ringgit firmed the most among regional currencies
after data showed factory output in November beat analyst
estimates, boosted by gains in all three major sectors.
    Malaysia's industrial production in November rose
5 percent from a year earlier, up from 3.4 percent growth in
October.
    The ringgit was also supported by higher oil prices as
energy exports contribute significantly to Malaysia's gross
domestic product.
    
    INDIAN RUPEE 
    While higher oil prices were a boon for the ringgit, they
put pressure on the rupee as India is Asia's second-largest oil
importer after China. The rupee fell 0.2 percent on Thursday,
with oil prices holding near three-year highs.
    A rise in oil prices could widen the country's current
account deficit.
    "High oil prices give potential for a fiscal slippage and
higher inflation, as crude imports for India remain large," said
Supaat. 
  
    The following table shows rates for Asian currencies against
the dollar on Thursday.
    
 CURRENCIES VS U.S.                                     
   DOLLAR                                               
 Change on the day at   0522 GMT                        
 Currency                     Latest bid  Previous day  Pct Move
 Japan yen                    111.760     111.42        -0.30
 Sing dlr                     1.333       1.3340        +0.07
 Taiwan dlr                   29.601      29.601        +0.00
 Korean won                   1071.400    1071.9        +0.05
 Baht                         32.020      32.11         +0.28
 Peso                         50.385      50.38         -0.01
 Rupiah                       13415.000   13434         +0.14
 Rupee                        63.743      63.59         -0.24
 Ringgit                      3.987       4.002         +0.38
 Yuan                         6.516       6.5071        -0.14
                                                        
 Change so far                                          
 Currency                     Latest bid  End 2017      Pct Move
 Japan yen                    111.760     112.67        +0.81
 Sing dlr                     1.333       1.3373        +0.32
 Taiwan dlr                   29.601      29.848        +0.83
 Korean won                   1071.400    1070.50       -0.08
 Baht                         32.020      32.58         +1.75
 Peso                         50.385      49.93         -0.90
 Rupiah                       13415.000   13565         +1.12
 Rupee                        63.743      63.87         +0.20
 Ringgit                      3.987       4.0440        +1.43
 Yuan                         6.516       6.5069        -0.15
 

 (Reporting by Aditya Soni in Bengaluru; Editing by Jacqueline
Wong)
  
 
 
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