October 29, 2019 / 6:40 AM / 16 days ago

EM ASIA FX-S Korean won leads broader gains on trade deal optimism

 (Adds text, updates prices)
    By Aby Jose Koilparambil
    Oct 29 (Reuters) - The South Korean won led
gainers in the Asian currency markets for a second consecutive
session on Tuesday, amid hopes that the first phase of a trade
deal between the United States and China is in the making.
    U.S. President Donald Trump said on Monday he expected to
sign a significant part of the trade deal with China ahead of
schedule, but did not elaborate on the timing.
    Leaders of the world's two biggest economies are working to
agree on the text for a "Phase 1" trade agreement announced by
Trump on Oct. 11. Trump has said he hopes to sign the deal with
China's President Xi Jinping next month at a summit in Chile.
    The renewed optimism around a partial resolution to the
festering Sino-U.S. trade row reduced demand for safe haven
assets including the greenback.
    The dollar index against a basket of six major currencies
 was more or less flat after slipping off one-week highs
on Monday.
    Also, investors remain focused on the U.S. Federal Reserve
meeting on Wednesday, when policymakers are expected to cut
interest rates by 25 basis points for the third time this year,
a move which is already priced in.
    "The ongoing positive sentiment around the Sino-U.S. phase-1
deal is rubbing off on Asian currencies," said Khoon Goh, head
of Asia research at ANZ Banking Group (Singapore).
    "The Korean won tends to do well on risk-on periods. Also,
during month-end period, exporters typically sell off dollars as
they convert export proceeds back into won and that's helping
the currency's strength."
    The won gained as much as 0.5% to its strongest in nearly
four months, after adding up to 0.4% in the previous session.
    The Indian rupee resumed trading on a strong note
after Monday's holiday, gaining as much as 0.3% to touch its
firmest level in nearly a month.
    The Chinese yuan, the Philippine peso and
the Taiwanese dollar gained as much as 0.2% each, while
the Indonesian rupiah and the Malaysian ringgit
 firmed slightly.
    The Thai baht trimmed marginal losses to trade more
or less unchanged.
    On Tuesday, Thailand's industry ministry said the country's
manufacturing production index in September fell a
worse-than-expected 4.7% from a year earlier, dragged down by
lower production of cars, petroleum and rubber.
 Change on the day at   0615 GMT                  
 Currency               Latest bid  Previous day  Pct Move
 Japan yen              108.980     108.94        -0.04
 Sing dlr               1.362       1.3619        -0.02
 Taiwan dlr             30.525      30.572        +0.15
 Korean won             1165.300    1170.7        +0.46
 Baht                   30.190      30.19         +0.00
 Peso                   50.970      51.13         +0.31
 Rupiah                 14015.000   14020         +0.04
 Rupee                  70.728      70.88         +0.22
 Ringgit                4.181       4.1845        +0.08
 Yuan                   7.060       7.0672        +0.11
 Change so far in 2019                            
 Currency               Latest bid  End 2018      Pct Move
 Japan yen              108.980     109.56        +0.53
 Sing dlr               1.362       1.3627        +0.04
 Taiwan dlr             30.525      30.733        +0.68
 Korean won             1165.300    1115.70       -4.26
 Baht                   30.190      32.55         +7.82
 Peso                   50.970      52.47         +2.94
 Rupiah                 14015.000   14375         +2.57
 Rupee                  70.728      69.77         -1.35
 Ringgit                4.181       4.1300        -1.22
 Yuan                   7.060       6.8730        -2.64

 (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by
Shounak Dasgupta)
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