United Kingdom

Shriya Ramakrishnan

EM ASIA FX-Most gain as rate cut expectations stall dollar

27 Feb 2020

* Malaysian ringgit, Taiwan dollar lead gains * Indonesian rupiah hits more than 2-month low (Adds text, updates prices) By Shriya Ramakrishnan Feb 27 Most emerging Asian currencies held ground on Thursday, as rising U.S. rate cut bets amid a spike in coronavirus cases beyond China prompted dollar buyers to take a pause. Fears of a pandemic mounted after the number of new coronavirus infections inside China was for the first time overtaken by fresh cases elsewhere on Wednesday, with Italy and Iran emerging as epicentres of the rapidly spreading illness. Markets have priced in a 45.4% probability of a U.S. rate cut when the Federal Reserve meets in March, up from 6.7% a week earlier, according to the CME FedWatch tool. "We've started to price in action for the Fed," said Stuart Oakley, global head of flow FX at Nomura in Singapore. "That's probably put the kibosh on the dollar rallying more, but I think it's all fairly temporary to be honest ... The dollar will probably grind out some more strength at some point." The Taiwan dollar strengthened as much as 0.4% against the greenback and was set for a third straight session of gains. Taiwan raised its epidemic response level to the highest as it readied a $2 billion package to cushion the virus impact on its export-reliant economy, the official Central News Agency reported. The move will allow the government to tackle the virus outbreak in a much faster manner, the report added. The Malaysian ringgit advanced 0.3% to 4.21 per dollar, as risk appetite improved ahead of a long-awaited economic stimulus package, which the government is likely to announce later in the day. The Thai baht firmed 0.2%, while the Singapore dollar was flat. The South Korean won rose up to 0.6% after the central bank surprisingly kept interest rates unchanged. The currency later gave up the gains to trade slightly lower as the country reported its largest daily increase in new coronavirus cases. The Chinese yuan inched higher as the country reported the slowest daily increase in coronavirus deaths in almost a month. The Indonesian rupiah was the worst performer, weakening 0.4% to a more than two-month low. "It is catching up with losses in other regional currencies. Risk aversion sentiment could prompt investors to square carry trade positions," said Gao Qi, currency strategist - EM Asia at Scotiabank. CURRENCIES VS U.S. DOLLAR Change on the day at 0559 GMT Currency Latest bid Previous day Pct Move Japan yen 110.040 110.42 +0.35 Sing dlr 1.397 1.3973 +0.04 Taiwan dlr 30.296 30.383 +0.29 Korean won 1217.000 1216.9 -0.01 Baht 31.800 31.85 +0.16 Peso 51.100 51.05 -0.10 Rupiah 13975.000 13925 -0.36 Rupee 71.640 71.64 +0.00 Ringgit 4.210 4.223 +0.31 Yuan 7.019 7.0230 +0.06 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 110.040 108.61 -1.30 Sing dlr 1.397 1.3444 -3.75 Taiwan dlr 30.296 30.106 -0.63 Korean won 1217.000 1156.40 -4.98 Baht 31.800 29.91 -5.94 Peso 51.100 50.65 -0.88 Rupiah 13975.000 13880 -0.68 Rupee 71.640 71.38 -0.36 Ringgit 4.210 4.0890 -2.87 Yuan 7.019 6.9632 -0.79 (Reporting by Shriya Ramakrishnan in Bengaluru; Additional reporting by Tom Westbrook; Editing by Subhranshu Sahu)

EM ASIA FX-Most currencies slip as virus spread sparks risk aversion

26 Feb 2020

* S. Korean won hits more than 2-month low * Chinese yuan eases; Taiwan dollar firms (Adds text, updates prices) By Shriya Ramakrishnan Feb 26 Most emerging Asian currencies weakened on Wednesday as a spike in coronavirus cases and a U.S. warning of an inevitable pandemic heightened worries of a global economic slowdown. China and South Korea reported 500 new cases, while the United States alerted Americans on Tuesday to begin preparing for coronavirus to spread within the country after infections surfaced in several more nations. "We are now in an early stage of the virus spread in some developed countries, which is concerning because it could dent investments and consumer sentiment," said Margaret Yang Yan, market analyst at CMC Markets Singapore. The South Korean won dropped 0.4% against the dollar, hitting its lowest in more than two months, as sentiment remained fragile after the country reported 169 new coronavirus cases. South Korean President Moon Jae-in on Tuesday called the situation "very grave" and said the coming week would be key in the battle to contain the virus. The Thai baht weakened 0.4% against the dollar. An investor darling in 2019, the baht has seen a sharp reversal of fortune and become Asia's worst performing currency so far this year. The Indonesian rupiah fell 0.3%, its biggest intraday drop in more than a month. Indonesia's finance minister warned the virus outbreak could pressure tax collection and widen the fiscal deficit this year, a day after the government unveiled a nearly $750 million stimulus package to protect the economy. The Chinese yuan eased 0.1%, while the Philippine peso edged higher. The Taiwan dollar rose 0.2% and was among the few outliers, a day after the parliament approved a $2 billion package to help cushion the impact from the outbreak. MALAYSIAN RINGGIT The ringgit weakened as much as 0.2% to 4.241 per dollar as traders kept a close watch on political developments while awaiting a stimulus package to soften the economic fallout from the epidemic. Malaysia's king met parliamentarians for a second day to try to end political turmoil by finding someone able to form a government or by calling a new election after Mahathir Mohamad's shock resignation as prime minister. "The ringgit on trade weighted basis may consolidate around current levels until we see further developments on the government and assistance package to deal with Covid-19," said Chu Kok Wei, group head, treasury and markets, CIMB Group. Mahathir said an economic stimulus package would be announced soon. He had been due to unveil the package on Thursday, but it was postponed to an unspecified date shortly after his resignation on Monday. CURRENCIES VS U.S. DOLLAR Change on the day at 0540 GMT Currency Latest bid Previous day Pct Move Japan yen 110.370 110.18 -0.17 Sing dlr 1.398 1.3985 +0.02 Taiwan dlr 30.338 30.402 +0.21 Korean won 1215.400 1210.3 -0.42 Baht 31.860 31.72 -0.44 Peso 51.050 51.09 +0.08 Rupiah 13910.000 13870 -0.29 Rupee 71.760 71.73 -0.04 Ringgit 4.236 4.232 -0.09 Yuan 7.018 7.0130 -0.07 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 110.370 108.61 -1.59 Sing dlr 1.398 1.3444 -3.85 Taiwan dlr 30.338 30.106 -0.76 Korean won 1215.400 1156.40 -4.85 Baht 31.860 29.91 -6.12 Peso 51.050 50.65 -0.78 Rupiah 13910.000 13880 -0.22 Rupee 71.760 71.38 -0.53 Ringgit 4.236 4.0890 -3.47 Yuan 7.018 6.9632 -0.78 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Subhranshu Sahu)

EM ASIA FX-Most currencies regain footing as dollar rally takes pause

25 Feb 2020

* Analyst calls recovery "just an interim reprieve" * S.Korean won leads gains, Indonesian rupiah weakens (Adds text, updates prices) By Shriya Ramakrishnan Feb 25 Most emerging Asian currencies firmed on Tuesday, clawing back some of the prior session's heavy losses, as growing U.S. rate-cut expectations took some steam out of the dollar's recent run. Financial markets have ratcheted up bets that the Federal Reserve will be pressed to cut interest rates to cushion a feared hit to economic growth from the coronavirus spread. A spike in coronavirus cases beyond mainland China sparked an exit from riskier assets on Monday and drove investors to the perceived safety of gold and government bonds. "The ability to regain some composure at softer levels is perhaps just an interim reprieve," said Vishnu Varathan, head of economics and strategy at Mizuho Bank. "The slight tempering in demand for safe havens, which has also softened the dollar at the margin, is also giving a breathing space for Asian currencies, but it is too premature to call for an emphatic and decisive bottoming." The onshore Chinese yuan advanced as much as 0.3% to 7.0087 per dollar. The Malaysian ringgit traded slightly lower, a day after Mahathir Mohamad unexpectedly quit as prime minister, leaving the country in political turmoil. Mahathir, however, agreed to a request by the Southeast Asian nation's king to stay on as interim premier until a successor is named. The Singapore dollar strengthened 0.2%, while the Thai baht inched lower. The Indonesian rupiah weakened 0.2% and was the worst performer, while the Indian rupee was flat. Market participants will now shift their focus to India's economic growth data for the last quarter of 2019. A Reuters poll shows growth in Asia's third-largest economy likely accelerated a touch in the October-December period, after its weakest expansion in more than six years in the previous quarter. Philippine financial markets were closed for a holiday, but the peso was up 0.2% in offshore trade. S.KOREAN WON The South Korean won gained as much as 0.9% against the dollar, marking its best performance in more than two weeks. This comes after the country reported a slowdown in new cases of coronavirus infections, and its finance minister on Monday said he had advised the government to start the review and execution of a supplementary budget to cushion the virus impact. "Caution remains warranted as the Covid-19 development remains fluid," said Christopher Wong, senior FX strategist at Maybank Singapore. The Bank of Korea is expected to lower its policy rate to a record low on Thursday, the third cut in the current easing cycle, a Reuters poll showed. CURRENCIES VS U.S. DOLLAR Change on the day at 0523 GMT Currency Latest bid Previous day Pct Move Japan yen 110.820 110.71 -0.10 Sing dlr 1.397 1.3994 +0.16 Taiwan dlr 30.383 30.472 +0.29 Korean won 1212.600 1220.2 +0.63 Baht 31.710 31.67 -0.13 Peso 50.950 51.05 +0.20 Rupiah 13895.000 13865 -0.22 Rupee 71.885 71.92 +0.05 Ringgit 4.223 4.218 -0.12 Yuan 7.015 7.0276 +0.19 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 110.820 108.61 -1.99 Sing dlr 1.397 1.3444 -3.77 Taiwan dlr 30.383 30.106 -0.91 Korean won 1212.600 1156.40 -4.63 Baht 31.710 29.91 -5.68 Peso 50.950 50.65 -0.59 Rupiah 13895.000 13880 -0.11 Rupee 71.885 71.38 -0.70 Ringgit 4.223 4.0890 -3.17 Yuan 7.015 6.9632 -0.73 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Subhranshu Sahu)

EM ASIA FX-Fears of virus spread pound Asian currencies; ringgit tumbles

24 Feb 2020

* S. Korean won drops to near six-month low * Political uncertainty sparks selling pressure on ringgit * Indonesia c.bank intervenes in FX, bond markets (Adds text, updates prices) By Shriya Ramakrishnan Feb 24 Emerging Asian currencies posted steep losses against the dollar on Monday as a rapid surge in coronavirus infections and deaths outside mainland China heightened fears of a pandemic and sent investors fleeing to safe-haven assets. Italy, South Korea and Iran reported a sharp rise in infections over the weekend. South Korea put the country on high alert, while Italy began sealing off the worst affected towns and banning public events after a spike in the number of virus cases to above 150. The South Korean won plunged 0.8% to a near six-month low against the greenback, in tandem with sharp falls in local equities. South Korea's vice finance minister Kim Yong-beom said a set of measures would be announced soon to boost exports, investments and domestic demand and that any "herd-like" speculative moves in currency markets would be stemmed. "There's a sobering realisation that this could really impact hard and fast... truly the notion of China sneezing and everyone catching a cold, that becomes a real fright for anyone watching this," said Vishnu Varathan, head of economics at Mizuho Bank, in Singapore. Against a basket of currencies, the dollar crept back toward an almost three-year peak touched last week amid a broader risk-aversion. The Indonesian rupiah, which has held up better so far this year against its Asian peers due to its carry trade appeal, fell 0.9% to its weakest level in more than a month during the session despite an intervention by the central bank. Indonesia's central bank has intervened in the spot currency, domestic non-deliverable forward and bond markets amid outflows related to fears of the spread of COVID-19 in South Korea, an official told Reuters on Monday. The Chinese yuan inched lower against the dollar, while the Singapore dollar fell 0.3%. The Thai baht dropped as much as 0.5% to hit a near nine-month low, with investors largely shrugging off an unexpected rise in exports for the trade-reliant economy in January. POLITICAL TURMOIL GRIPS MALAYSIAN RINGGIT Malaysian Prime Minister Mahathir Mohamad has submitted his letter of resignation to the king, his office said on Monday, amid talk of forming a new governing coalition. The uncertainty added pressure on the ringgit, with the local unit sliding 0.8% to 4.22 per dollar, its weakest level in five-and-a-half months. Yields on the country's 10-year government bonds also rose 6.1 bps to 2.972, as of Monday's open. Malaysian bonds, long a favourite with foreign investors, have seen net heavy inflows between November and January. CURRENCIES VS U.S. DOLLAR Change on the day at 0616 GMT Currency Latest bid Previous day Pct Move Japan yen 111.570 111.57 +0.00 Sing dlr 1.403 1.3981 -0.31 Taiwan dlr 30.440 30.403 -0.12 Korean won 1219.300 1209.2 -0.83 Baht 31.735 31.61 -0.39 Peso 50.960 50.89 -0.14 Rupiah 13890.000 13760 -0.94 Rupee 71.838 71.65 -0.26 Ringgit 4.220 4.188 -0.76 Yuan 7.035 7.0265 -0.13 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 111.570 108.61 -2.65 Sing dlr 1.403 1.3444 -4.14 Taiwan dlr 30.440 30.106 -1.10 Korean won 1219.300 1156.40 -5.16 Baht 31.735 29.91 -5.75 Peso 50.960 50.65 -0.61 Rupiah 13890.000 13880 -0.07 Rupee 71.838 71.38 -0.64 Ringgit 4.220 4.0890 -3.10 Yuan 7.035 6.9632 -1.03 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Amy Caren Daniel)

Asia FX sentiment weakens; bearish bets pile on Singapore dollar: Reuters poll

20 Feb 2020

Investors strengthened bearish positions on most Asian currencies, especially the Singapore dollar over the past two weeks, a Reuters poll showed, as the deepening economic impact of a deadly virus epidemic in China dampened risk appetite.

EM ASIA FX-Most Asian units weaken on virus anxiety, but set for weekly gains

14 Feb 2020

* Taiwan dollar and Malaysian ringgit strengthen * There is still demand for carry trades - analyst * S.Korea pledges emergency steps to minimise economic impact (Adds text, updates prices) By Shriya Ramakrishnan Feb 14 Most emerging Asian currencies weakened against the U.S. dollar on Friday, but were on course for weekly gains, supported by prospects of stimulus measures by policymakers to shield their economies from the impact of the coronavirus outbreak. The outbreak in China showed no signs of peaking with health authorities on Friday reporting more than 5,000 new coronavirus cases and 121 new deaths. Economists are scaling back growth expectations for the Chinese economy in the current quarter, though they say the downturn will be short-lived if the outbreak is contained. "We need concrete evidence that economic data is not going to be worser than what we think it is. The Asian currency landscape is however not bad, because we have the People's Bank of China (PBOC) guiding or trying to keep the yuan trading below 7 and there is still demand for carry trades," Stephen Innes, chief market strategist at AxiCorp said. The onshore Chinese yuan weakened against a slightly stronger dollar. The South Korean won pared early losses to trade a tick lower, finding some support as the country's two economic policy chiefs pledged to deploy emergency measures to minimise the economic impact from the coronavirus outbreak. South Korea's central bank chief also said on Friday that the bank must take a cautious approach to any further rate cuts. The Singapore dollar and Thai baht eased slightly during the day, while the Malaysian ringgit strengthened. Currencies of tourist hubs such as Singapore, Thailand and Malaysia have relatively been more affected by the virus outbreak as it threatens a slowdown in Chinese trade and visitors from China. Thailand's tourism ministry on Thursday said the number of foreign tourists in the country slumped nearly 40% between Feb. 1 and 7. Meanwhile, central banks of Malaysia and Thailand have cut their policy rates by 25 basis points this year. While the Philippine peso, Indonesian rupiah, and Indian rupee weakened between 0.1% and 0.2% during the session, analysts say the high yields offered by these currencies have helped them weather the virus storm stronger than their peers. "The high yielders are a little bit more immune to the carry and to the virus scare because central banks are easing and we are getting bond inflows," Innes added. FOREIGN INFLOWS SUPPORT TAIWAN DOLLAR The Taiwan dollar strengthened as much as 0.2% against the greenback, lifted by a large amount of foreign exchange inflows and provisions taken to assuage the impact on the island's economy. Taiwan's cabinet on Thursday proposed a special budget of $2 billion as the virus outbreak threatens to hit its economy, which is a key part of the global electronics supply chain. Foreign investors have purchased $273.8 million worth of Taiwanese stocks in the past two days, according to Refinitiv data. CURRENCIES VS U.S. DOLLAR Change on the day at 0624 GMT Currency Latest bid Previous day Pct Move Japan yen 109.760 109.81 +0.05 Sing dlr 1.390 1.3891 -0.05 Taiwan dlr 30.007 30.037 +0.10 Korean won 1183.700 1182.8 -0.08 Baht 31.170 31.14 -0.10 Peso 50.510 50.46 -0.10 Rupiah 13700.000 13675 -0.18 Rupee 71.403 71.29 -0.16 Ringgit 4.139 4.141 +0.05 Yuan 6.986 6.9775 -0.13 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.760 108.61 -1.05 Sing dlr 1.390 1.3444 -3.27 Taiwan dlr 30.007 30.106 +0.33 Korean won 1183.700 1156.40 -2.31 Baht 31.170 29.91 -4.04 Peso 50.510 50.65 +0.28 Rupiah 13700.000 13880 +1.31 Rupee 71.403 71.38 -0.03 Ringgit 4.139 4.0890 -1.21 Yuan 6.986 6.9632 -0.33 (Reporting by Shriya Ramakrishnan in Bengaluru, Editing by Sherry Jacob-Phillips)

EM ASIA FX-Most Asian currencies weaken as virus cases jump

13 Feb 2020

* Indonesian rupiah at over 1-month low * Taiwan dollar, Philippine peso strengthen * Thai economy may grow less than 2% this year (Adds text, updates prices) By Shriya Ramakrishnan Feb 13 Most emerging Asian currencies weakened on Thursday as a surge in the number of new coronavirus cases dampened risk sentiment, prompting a flight to safe-haven assets. The Chinese province at the epicentre of the epidemic, Hubei, reported a record rise in the death toll and health experts warned that it could worsen before getting better. The offshore yuan and onshore yuan slid about 0.2% each above the 6.98 level. Analysts called it a knee-jerk reaction to the new numbers on infections and death in China. Asian currencies have responded to the virus outbreak differently. Export-focused currencies with greater trade-linkages to China have weakened substantially, with the Thai baht dropping 4.1% and Singapore dollar slipping 3.2% so far this year. However, high-yielding currencies and those perceived to be relatively insulated from economic shocks have benefited, with the Indonesian rupiah and Philippine peso fairly resilient this year. The Singapore dollar weakened 0.2% on the day, while the baht dipped slightly. A senior central bank official said on Thursday Thailand's economy may grow by less than 2% this year. The S. Korean won depreciated 0.2%, while the Malaysian ringgit edged down. The Indian rupee traded 0.2% lower. Data on Wednesday showed the country's annual retail inflation accelerated to its highest level in nearly six years, while industrial output unexpectedly contracted. The Indonesian rupiah weakened 0.2% to its lowest level in more than a month. It is, however, the top performing currency so far this year. "From a growth perspective India has kind of lagged and you need an emerging economy of substantial size and growth potential and still offering decent yields. So, the IDR becomes an obvious alternative," said Mahesh Sethuraman, deputy head of global sales trading at Saxo Capital Markets. "If risk-on assets globally are down, then we may see some IDR weakness which is more structural." The Taiwan dollar gained as much as 0.2%, finding some support from the government's plans to spend $2 billion to help cushion the impact on the economy from the coronavirus. PHILIPPINE PESO The Philippine peso strengthened as much as 0.3% against the U.S. dollar. "The peso has been the least affected in this virus spread in Asia so the indirect flight of capital from THB to PHP is logical. Given that tourism from China is such a substantial part of Thailand's revenue, the baht has got some lengths to go in terms of weakness," Sethuraman said. Earlier this week, Fitch Ratings upgraded the Philippines' outlook to "positive" from "stable" and said it expects growth to accelerate in 2020 and 2021 on the back of strong private consumption and rising infrastructure investment. CURRENCIES VS U.S. DOLLAR Change on the day at 0615 GMT Currency Latest bid Previous day Pct Move Japan yen 109.810 110.08 +0.25 Sing dlr 1.388 1.3861 -0.17 Taiwan dlr 29.996 30.032 +0.12 Korean won 1182.000 1179.5 -0.21 Baht 31.180 31.14 -0.13 Peso 50.452 50.54 +0.17 Rupiah 13685.000 13655 -0.22 Rupee 71.473 71.35 -0.17 Ringgit 4.140 4.137 -0.07 Yuan 6.984 6.9718 -0.18 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.810 108.61 -1.09 Sing dlr 1.388 1.3444 -3.17 Taiwan dlr 29.996 30.106 +0.37 Korean won 1182.000 1156.40 -2.17 Baht 31.180 29.91 -4.07 Peso 50.452 50.65 +0.39 Rupiah 13685.000 13880 +1.42 Rupee 71.473 71.38 -0.13 Ringgit 4.140 4.0890 -1.23 Yuan 6.984 6.9632 -0.30 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Arun Koyyur)

EM ASIA FX-Export-dependent Asian units take comfort from drop in new virus cases

12 Feb 2020

* Thai baht leads gains * Indian rupee dips slightly ahead of inflation data * Malaysia c. bank says 'ample room' for rate cut (Adds text, updates prices) By Shriya Ramakrishnan Feb 12 Currencies of export-focused Asian countries notched gains against the dollar on Wednesday, as a slowdown in the pace of new coronavirus infections fuelled hopes that the worst of the epidemic might be over. China on Wednesday reported its lowest number of new coronavirus cases since late January, lending credence to a prediction from the country's senior medical adviser that the outbreak could be over by April. An uptick in U.S. yields, as bond prices fell, and the accompanying rise in global equities suggested a slow return to higher investor risk appetites, with the dollar losing ground against Asian currencies. "It is important that we see containment efforts materialising into actual containment of the virus - new cases continue to slow, while recovery rises and outside-China spread is contained," Christopher Wong, a senior FX strategist at Maybank Singapore said. The Thai baht strengthened 0.5% to 31.11 against the greenback, while the Chinese yuan edged up. The baht is the worst performing emerging Asian currency this year - a reversal from its position as Asia's best performing currency last year and in 2018 - as the virus outbreak hurts Thailand's lucrative tourism sector. The South Korean won advanced 0.3%, while the Taiwan dollar also gained 0.3% to its strongest level in more than three weeks. The Malaysian ringgit erased early gains to edge down 0.1%. Malaysia's central bank said on Wednesday there was "ample room" for a rate cut after economic growth slowed to the weakest in a decade in the fourth quarter and the coronavirus outbreak threatened to pile more pressure this year. The Indian rupee inched lower, ahead of the release of inflation data later in the day. Inflation is expected to rise to a near six-year peak in January as food prices stayed high, according to a Reuters poll. The Indonesian rupiah traded little changed, while the Philippine peso dipped slightly. CURRENCIES VS U.S. DOLLAR Change on the day at 0545 GMT Currency Latest bid Previous day Pct Move Japan yen 109.850 109.77 -0.07 Sing dlr 1.385 1.3861 +0.09 Taiwan dlr 29.973 30.068 +0.32 Korean won 1177.600 1181.6 +0.34 Baht 31.110 31.275 +0.53 Peso 50.510 50.5 -0.02 Rupiah 13655.000 13660 +0.04 Rupee 71.240 71.23 -0.01 Ringgit 4.135 4.131 -0.10 Yuan 6.960 6.9660 +0.08 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.850 108.61 -1.13 Sing dlr 1.385 1.3444 -2.92 Taiwan dlr 29.973 30.106 +0.44 Korean won 1177.600 1156.40 -1.80 Baht 31.110 29.91 -3.86 Peso 50.510 50.65 +0.28 Rupiah 13655.000 13880 +1.65 Rupee 71.240 71.38 +0.20 Ringgit 4.135 4.0890 -1.11 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Aditya Soni)

EM ASIA FX-Asian units gain on China stimulus hopes, drop in new virus cases

11 Feb 2020

* S.Korean won, Thai baht lead gains * Singapore dollar set to snap 11-day losing streak * Malaysian ringgit gains most in nearly 2 weeks (Adds text, updates prices) By Shriya Ramakrishnan Feb 11 Emerging Asian currencies strengthened on Tuesday, as a drop in new coronavirus cases and hopes for more stimulus by Beijing to prop up a virus-stricken economy improved risk appetite. Chinese policymakers have implemented a raft of measures, including liquidity injections and import tariff exemptions for materials used for epidemic control, to support an economy jolted by the virus outbreak. "The strengthening of the yuan has flown through to the rest of the Asian currency basket," said Khoon Goh, head of Asia research at ANZ Banking Group (Singapore). The onshore yuan firmed 0.2% against the dollar, set for the second straight session of gains. A Chinese central bank advisor said on Tuesday the People's Bank of China (PBOC) should consider lowering its benchmark deposit rate to enable banks to reduce lending rates and help small businesses. "As long as the coronavirus outbreak persists, the PBOC will likely adopt a supportive stance with its policy settings. The yuan may also be relied on to help offset the economic pressures on the Chinese economy," said Han Tan, a market analyst at FXTM. The death toll from the coronavirus epidemic in mainland China climbed past 1,000 on Tuesday, however, the number of new confirmed cases fell. Currencies of export-focused countries, which have been under selling pressure due to concerns about the economic fallout of the virus outbreak and a stronger dollar, led gains in the region. Both the South Korean won and the Thai baht appreciated 0.3%. The Singapore dollar strengthened 0.2% and was set to end a 11-day losing streak, while the Taiwan dollar also advanced 0.2%. Singapore expects a 25-30% drop in visitors this year due to the new coronavirus outbreak, with a significant decline in Chinese travel to the city-state expected to extend to other key markets. The Malaysian ringgit firmed 0.2%, the most in nearly two weeks. Focus will now shift to the country's fourth-quarter economic growth figure due on Wednesday, which is expected to slow to its weakest since mid-2016 on lower private consumption and external demand, according to a Reuters poll. The Philippine peso gained 0.2%. Data on Tuesday showed the Philippines' trade deficit narrowed to its lowest level in six months in December, due to a surge in exports. The Indian rupee and Indonesian rupiah edged up 0.1% each. CURRENCIES VS U.S. DOLLAR Change on at 0554 GMT Currency Latest bid Previous day Pct Move Japan yen 109.890 109.74 -0.14 Sing dlr 1.387 1.3894 +0.15 Taiwan dlr 30.029 30.102 +0.24 Korean won 1183.300 1187.1 +0.32 Baht 31.170 31.27 +0.32 Peso 50.700 50.78 +0.16 Rupiah 13680.000 13690 +0.07 Rupee 71.203 71.30 +0.14 Ringgit 4.138 4.148 +0.24 Yuan 6.973 6.9875 +0.21 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.890 108.61 -1.16 Sing dlr 1.387 1.3444 -3.09 Taiwan dlr 30.029 30.106 +0.26 Korean won 1183.300 1156.40 -2.27 Baht 31.170 29.91 -4.04 Peso 50.700 50.65 -0.10 Rupiah 13680.000 13880 +1.46 Rupee 71.203 71.38 +0.25 Ringgit 4.138 4.0890 -1.18 Yuan 6.973 6.9632 -0.14 (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Aditya Soni)

CORRECTED-(OFFICIAL)- EM ASIA FX-Most Asian currencies firm as China returns to work

10 Feb 2020

(Rewrites penultimate paragraph to correct Malaysia GDP forecast to 4.8% from 4.5%) * Philippine peso leads gains * China's Jan factory-gate prices snaps 6 months of y/y declines * S. Korean won hits 1-week low By Shriya Ramakrishnan Feb 10 Most emerging Asian currencies firmed on Monday as Chinese authorities lifted some work restrictions and implemented measures to support the economy, though concerns around the virus outbreak persisted due to a mounting death toll. Workers began trickling back to offices and factories around China on Monday as the government eased some restrictions on working in the wake of the coronavirus epidemic that has now killed more than 900 people, mostly on the mainland. The Chinese yuan rose 0.2% to 6.988 per dollar, supported by strong corporate demand for the local currency on the first working day since the extended Lunar New Year holiday. Jingyi Pan, a market strategist at IG Asia, said Asian currencies were receiving some respite from an injection of fresh liquidity into the market by China's central bank and factory-gate inflation readings coming in line with expectations in January. Traders told Reuters that China's central bank injected about 900 billion yuan ($128.77 billion) into the markets via reverse repo operations on Monday. It will also provide special funds for banks to re-lend to businesses combating the virus. Leading gains in the region, the Philippine peso strengthened 0.4% to 50.75 against the greenback. "The peso has been quite resilient. Perhaps, the economic linkage to China in relative sense is lower and hence the downside risks are perceived to be lesser. The growth story in Philippines has been one of the better ones across the region," said Sim Moh Siong, an FX strategist at the Bank of Singapore. However, Siong warned the resilience in some of the regional currencies that have been lagging in the sell-off could crack if concerns surrounding the virus outbreak escalates. The Taiwan dollar edged up 0.1%, while the Indian rupee strengthened 0.2%. Markets will now focus on inflation figures for India due on Wednesday, which is likely to show inflation rose to a near six-year peak in January as food prices stayed high. The Singapore dollar wavered between gains and losses during the session. The country on Friday raised its coronavirus alert level to orange and reported more cases not linked to previous infections or travel to China. Singapore's government last week said its currency has room to weaken to accommodate any economic hit. The local unit has lost about 3.2% so far this year. The Indonesian rupiah slipped 0.3%, while the South Korean won weakened 0.2%. The Malaysian ringgit edged down 0.1%. Malaysian Prime Minister Mahathir Mohamad said on Monday the economy is expected to expand by 4.8% this year, maintaining the government's forecast as it braces for a potential global slowdown tied to the novel coronavirus outbreak. Financial markets in Thailand were closed for a holiday. CURRENCIES VS U.S. DOLLAR Change on the day at 0550 GMT Currency Latest bid Previous day Pct Move Japan yen 109.770 109.72 -0.05 Sing dlr 1.389 1.3892 +0.03 Taiwan dlr 30.097 30.126 +0.10 Korean won 1188.300 1186.5 -0.15 Peso 50.750 50.94 +0.37 Rupiah 13710.000 13670 -0.29 Rupee 71.345 71.45 +0.15 Ringgit 4.144 4.1405 -0.08 Yuan 6.988 7.0010 +0.19 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.770 108.61 -1.06 Sing dlr 1.389 1.3444 -3.20 Taiwan dlr 30.097 30.106 +0.03 Korean won 1188.300 1156.40 -2.68 Baht 31.270 29.91 -4.35 Peso 50.750 50.65 -0.20 Rupiah 13710.000 13880 +1.24 Rupee 71.345 71.38 +0.05 Ringgit 4.144 4.0890 -1.33 Yuan 6.988 6.9632 -0.35 ($1 = 6.9891 Chinese yuan renminbi) (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Amy Caren Daniel)

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