January 10, 2018 / 6:13 AM / 2 months ago

EM ASIA FX-Philippine peso falls on record trade deficit, Asian FX mixed

 (Adds text, updates prices)
    By Aditya Soni
    Jan 10 (Reuters) - The Philippine peso hit a more than
three-week low on Wednesday after the country posted a record
trade deficit, while most other Asian currencies lacked
direction as the dollar struggled to sustain its recent
     Data released eariler in the session showed that
Philippines trade deficit rose to a record of $3.78 billion in
November, puting the nation on track for its first annual
current account deficit in 15 years.
    "The peso has strengthened over the last month but given
that trade deficit has continued to detoriate the focus will
shift back to the country's external position and that should
weigh on the peso," said Khoon Goh, head of Asia research at ANZ
Banking Group.
    Most other regional currencies lacked firm leads as the U.S.
dollar pared gains made earlier in the Asian day. 
     The greenback edged up earlier in the session, after
benchmark U.S. Treasury yields hit a 10-month high on Tuesday,
but the U.S. currency was 0.1 percent lower at 0513 GMT. 
    Goh added that he expects Asian currencies to consolidate in
the near-term as they had a strong run in December and early
part of this year. 
    The Korean won, which was 2017's biggest advancer
in the region, weakened 0.3 percent, in tandem with the KOSPI
stock index which fell almost quarter of a percent.
    The won is on track to register a fourth consecutive day of
losses and has been falling ever since Bank of Korea said it
will respond if moves in the won get too big.
    On Monday, two currency traders told Reuters the South
Korean foreign exchange authorities were suspected of buying
dollars in the market as the won strengthened to a more than
three-year intraday high.
    The Taiwan dollar also softened, while the
Indonesian rupiah slipped 0.1 percent. 
    Conversely, the Thai baht firmed 0.2 percent, while
the Indian rupee strenghtened 0.1 percent. 
    The Chinese yuan firmed 0.1 percent, after 
China's central bank lowered its official yuan midpoint
 to the weakest level in nearly two weeks to 6.5207
per dollar on Wednesday.
     The lower fix came as the People's Bank of China
effectively neutralised the so-called "counter-cyclical factor"
it introduced last year to help manage the yuan's daily
reference rate sources familiar with the matter said on Tuesday.
     "The counter-cyclical adjustment facility decision probably
reflected China's satisfaction that the yuan is no longer viewed
as a one-way bet, up or down," DBS said in a note. 
    The following table shows rates for Asian currencies against
the dollar on Wednesday.
 Change on the day at   0513 GMT                        
 Currency                     Latest bid  Previous day  Pct Move
 Japan yen                    112.260     112.64        +0.34
 Sing dlr                     1.335       1.3351        -0.02
 Taiwan dlr                   29.582      29.536        -0.16
 Korean won                   1070.000    1067.1        -0.27
 Baht                         32.200      32.252        +0.16
 Peso                         50.350      50.29         -0.12
 Rupiah                       13443.000   13435         -0.06
 Rupee                        63.675      63.71         +0.05
 Ringgit                      4.008       4.007         -0.02
 Yuan                         6.523       6.5285        +0.08
 Change so far                                          
 Currency                     Latest bid  End 2017      Pct Move
 Japan yen                    112.260     112.67        +0.37
 Sing dlr                     1.335       1.3373        +0.14
 Taiwan dlr                   29.582      29.848        +0.90
 Korean won                   1070.000    1070.50       +0.05
 Baht                         32.200      32.58         +1.18
 Peso                         50.350      49.93         -0.83
 Rupiah                       13443.000   13565         +0.91
 Rupee                        63.675      63.87         +0.31
 Ringgit                      4.008       4.0440        +0.90
 Yuan                         6.523       6.5069        -0.25
 (Reporting by Aditya Soni in Bengaluru; Editing by Sam Holmes)
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