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EM ASIA FX-Asian currencies subdued as Fed meeting in focus

Kitco News

(Adds details, updates prices)

By Ambar Warrick

July 26 (Reuters) - Most Asian currencies inched lower on Wednesday as the dollar edged up from a 13-month low, with investors on the sidelines awaiting clues from the U.S. Federal Reserve on the timing of its next monetary tightening.

The dollar edged up against a basket of currencies, with sentiment subdued ahead of the conclusion of the Fed's meeting later in the global day, which could shed some light on its plans to trim its $4.2 trillion bond portfolio. That reduction could put upward pressure on long-term interest rates, driving funds away from emerging markets.

"FOMC risks are not exclusively dovish as guidance on balance sheet reduction could be the backstop for the sustained dovish bets dragging yields and the USD," Mizuho Bank in Singapore said in a research note.

In Asian currencies, the Thai baht fell against the dollar.

Thailand's central bank announced new rules on Wednesday to tighten controls on credit cards and unsecured personal loans amid concerns about high household debt and rising bad loans. "Asian net portfolio inflows continue to demonstrate waning inflow momentum for the KRW, TWD, INR, and PHP, while the THB continues to look stretched with respect to this metric," OCBC Bank said in a research note.

The Philippine peso fell against the dollar, after touching a one-week high on Tuesday. The Indian rupee also edged slightly lower against the dollar, while the Taiwan dollar eased off a one-week high.

SOUTH KOREAN WON

The South Korean won fell against the dollar on Wednesday, taking a breather from its recent two-week rally. "The latest export numbers from South Korea have been quite encouraging," said Dominic Schnider, Head Commodities and APAC Forex at UBS Wealth Management Hong Kong. "For the time being, with fundamentals looking better in the region, the won is still one of the top performers."

The following table shows rates for Asian currencies against the dollar at 0514 GMT

Change on the day at

0514 GMT Currency Latest bid Previous day Pct Move Japan yen 111.910 111.88 -0.03 Sing dlr 1.363 1.3620 -0.07 Taiwan dlr 30.388 30.360 -0.09 Korean won 1120.800 1115.3 -0.49 Baht 33.490 33.45 -0.12 Peso 50.650 50.54 -0.22 Rupiah 13333.000 13325 -0.06 Rupee 64.420 64.38 -0.06 Ringgit 4.282 4.28 -0.05 Yuan 6.756 6.7520 -0.06

Change so far in 2017 Currency Latest bid End 2016 Pct Move Japan yen 111.910 117.07 +4.61 Sing dlr 1.363 1.4490 +6.31 Taiwan dlr 30.388 32.279 +6.22 Korean won 1120.800 1207.70 +7.75 Baht 33.490 35.80 +6.90 Peso 50.650 49.72 -1.84 Rupiah 13333.000 13470 +1.03 Rupee 64.420 67.92 +5.43 Ringgit 4.282 4.4845 +4.73 Yuan 6.756 6.9467 +2.82



(Reporting by Ambar Warrick in Bengaluru; Editing by Lisa Twaronite & Shri Navaratnam)

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