* Graphic: World FX rates tmsnrt.rs/2egbfVh * Graphic: Foreign flows into Asian stocks tmsnrt.rs/3lKhL5I * Taiwan dollar hits strongest level since June 2011 * Indonesian stocks at near 1-month high * Malaysian shares fall on rising COVID-19 cases By Shriya Ramakrishnan Oct 12 (Reuters) - Most Asian currencies inched lower on Monday after a policy tweak by China's central bank pulled back some of the yuan's gains, while stock markets across the region rose as investors latched on to hopes a deal for U.S. stimulus would be reached. An over 2% gain in Chinese shares also lent support to regional equity markets. Indonesia shares rose up to 1% on easing of coronavirus curbs in the capital city of Jakarta for the next two weeks. The rupiah dipped slightly, ahead of Bank Indonesia's meeting on Tuesday where it is widely expected to keep benchmark rates steady at 4.00%, especially after concerns over the central bank's independence have kept the currency under pressure. Market participants also barely reacted to protests over a new jobs law in Indonesia, which economists say could improve the nation's investment climate. But protesters say the law undermines labour rights and weakens environmental protections. A pullback in the yuan from a 17-month high kept a lid on gains for most Asian currencies after the People's Bank of China cut foreign exchange forward reserve requirements, seen as aimed at tempering the yuan's recent strength. "We believe the authorities are comfortable about the overall flow picture, expecting that a removal of the policy tool should not reverse the downtrend by USD-RMB," analysts at HSBC Research wrote in a client note. The Singapore dollar, Malaysian ringgit and Philippine peso traded flat to lower during the day, while the Taiwan dollar once again outperformed with gains of more than 1% to reach its highest since June 2011. The Taiwan dollar, Asia's top performing currency so far this year, has benefited from stronger exports, helped by demand for laptops and tablets to support the work-from-home trend during the pandemic. "Better COVID-19 management compared to peers in Asia and the CBC (Taiwan's central bank) taking a hands-off approach to the currency strengthening has enabled the trend to sustain," said Jingyi Pan, market strategist at trading firm IG Asia. Malaysian stocks drifted lower, weighed down by concerns over a sharp spike in coronavirus infections over the weekend. While Malaysia has so far kept a major contagion at bay, several new infections have been traced in the wake of last month's election in Sabah state, prompting authorities to impose targeted lockdowns to curb the outbreak. HIGHLIGHTS: ** Malaysia's 10-year benchmark yield is up 0.1 basis points at 2.711% ** Top gainers on the Jakarta stock index include Citra Tubindo Tbk PT up 24.66% at 2730 rupiah, Bank Permata Tbk PT up 24.56% at 2460 rupiah ** Top losers on FTSE Bursa Malaysia Kl Index include Sime Darby Plantation Bhd down 3.1% at 5 ringgit; Sime Darby Bhd down 2.85% at 2.39 ringgit; CIMB Group Holdings Bhd down 2.22% at 3.09 ringgit Asia stock indexes and currencies at 0707 GMT COUNTRY FX RIC FX FX INDEX STOCK STOCKS DAILY YTD % S YTD % % DAILY % Japan +0.13 +3.00 -0.26 -0.41 China -0.30 +3.72 2.62 10.09 India -0.07 -2.46 0.09 -2.00 Indonesi -0.10 -5.51 0.83 -19.11 a Malaysia +0.00 -1.11 -0.79 -4.44 Philippi -0.16 +4.59 0.09 -24.03 nes S.Korea +0.57 +0.84 0.49 9.38 Singapor -0.07 -0.69 0.40 -21.09 e Taiwan +1.25 +5.24 0.53 7.99 Thailand -0.03 -3.70 0.80 -19.15 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Krishna Chandra Eluri)
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