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EM ASIA FX-Asian currencies subdued, U.S. inflation in spotlight
July 14, 2017 / 6:49 AM / 5 months ago

EM ASIA FX-Asian currencies subdued, U.S. inflation in spotlight

 (Adds details, updates prices)
    By Susan Mathew
    July 14 (Reuters) - Most Asian currencies drifted on Friday,
while the U.S. dollar steadied, with investor focus turning to
U.S. inflation due later in the day for clues on the pace of
interest rate rises in the world's largest economy.
    U.S. consumer prices in June are forecast to have risen only
1.7 percent from a year earlier.
    The dollar index was down 0.01 percent at 95.720 at
0548 GMT.
    Federal Reserve Chair Janet Yellen in her address to the
Senate Banking Committee on Thursday, further reiterated her
dovish stance on tightening, citing falling inflation as an
influential factor.
    "We have a risk off situation in the perception of a dovish
Fed. This means that the EM carry trade will go on and risk
assets should not be too hard hit," said Saktiandi Supaat, head
of FX research at Maybank in Singapore.
    Most Asian currencies were subdued with the exception of the
Thai baht, which rose 0.2 percent, and the Philippine
peso, down 0.3 percent in intraday trade.
    The Indian rupee was up marginally ahead of
wholesale price inflation and forex reserves data due later on
    Wholesale price inflation is expected to have
slowed last month to 1.60 percent from 2.17 percent in May, a
Reuters poll showed.
    The Singapore dollar trimmed losses from earlier in
the day. 
    The city-state's economy expanded a seasonally adjusted and
annualised 0.4 percent in the second quarter from the first,
narrowly dodging a recession helped by solid global demand for
its tech products.
    In the coming week, investors will be focused on the start
of the U.S. earnings season. Markets expect S&P 500 companies to
report second-quarter earnings growth of 7.8 percent.
    The Philippine peso was down 0.2 percent, on-track to post
its fifth straight weekly loss.  
    Philippine Budget Secretary Benjamin Diokno said on Friday
he is not worried about the weakening peso because the country
has enough buffers and a steady source of foreign exchange
    A Reuters poll showed that bearish positions in the
Philippine peso increased to their largest since late March
after the currency fell to 11-year lows earlier in the week,
partly due to a widening trade balance. 
    Bucking the trend, the Thai baht was up 0.2
percent, "heavy on expectations that U.S. rate hikes will be
gradual and will not significantly slow inflows into Thai
assets," said May Bank's Saktiandi.
    Risk-on sentiments today could see greater inflows and
support the baht intraday, he added.
    Sim Moh Siong, FX strategist at the Bank of Singapore, added
that on days that the dollar moves sideways, Thailand's strong
current account surplus comes forward to support it.
    The baht was on-track to snap two straight weeks of losses.
 Change on the day at 0547 GMT                     
 Currency                Latest bid  Previous day  Pct Move
 Japan yen               113.370     113.27        -0.09
 Sing dlr                1.373       1.3736        +0.01
 Taiwan dlr              30.400      30.385        -0.05
 Korean won              1135.200    1136.3        +0.10
 Baht                    33.888      33.95         +0.18
 Peso                    50.640      50.53         -0.22
 Rupiah                  13347.000   13346         -0.01
 Rupee                   64.460      64.44         -0.03
 Ring                    4.293       4.2905        -0.06
 Yuan                    6.781       6.7848        +0.05
 Change so far in 2017                             
 Currency                Latest bid  End 2016      Pct Move
 Japan yen               113.370     117.07        +3.26
 Sing dlr                1.373       1.4490        +5.50
 Taiwan dlr              30.400      32.279        +6.18
 Korean won              1135.200    1207.70       +6.39
 Baht                    33.888      35.80         +5.64
 Peso                    50.640      49.72         -1.82
 Rupiah                  13347.000   13470         +0.92
 Rupee                   64.460      67.92         +5.37
 Ringgit                 4.293       4.4845        +4.46
 Yuan                    6.781       6.9467        +2.44
 (Reporting by Susan Mathew in Bengaluru; Editing by Jacqueline

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