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EM ASIA FX-Won leads regional gains on improved risk appetite

Published 10/21/2019, 02:48 PM
© Reuters.  EM ASIA FX-Won leads regional gains on improved risk appetite
USD/SGD
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USD/PHP
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DXY
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* Won hits strongest level in more than 3 months
* Reaction muted to China keeping lending benchmark rate
intact

(Adds text, updates prices)
By Aby Jose Koilparambil
Oct 21 (Reuters) - Asian currencies strengthened on Monday,
with South Korea's won leading gains as hopes of progress on
U.S.-China trade talks lifted appetite for risk assets,
pressuring the dollar.
The dollar index .DXY , measuring the greenback against six
major currencies, was little changed after falling more than a
percent last week in its worst weekly performance in 17 weeks.
Broader sentiment was also underpinned by positive comments
from China's top trade negotiator, Vice Premier Liu He, on
Friday that the Chinese government will work with Washington to
address each other's concerns, and that stopping the trade war
would be good for both sides and the world. The won KRW=KFTC led gains, putting on as much as 0.7% to
its strongest since July 19.
"The Asian market is broadly reacting to movements in the
dollar, which has remained weak of late. The Korean won has high
beta to dollar movements and generally does well when the dollar
weakens," said Mitul Kotecha, senior emerging markets strategist
at TD Securities.
"Some of the key major risks have been sidelined for now
following some progress on the U.S.-China trade negotiations and
that is helping risk assets."
The Chinese yuan CNY=CFXS firmed as much as 0.2% after the
country's central bank fixed the daily midpoint at its strongest
in five weeks.
Separately, China's central bank unexpectedly kept its new
lending benchmark rate unchanged on Monday, suggesting Beijing
is keen to avoid overly loosening monetary policy for fear it
may push up already-high debt levels across the economy.
However, the reaction to the lending rate decision was
relatively muted in the regional currency market.
The Indonesian rupiah INR=IN , the Philippine peso PHP=
and the Singapore dollar SGD= gained up to 0.2% each.
The Thai baht THB=TH and the Malaysian ringgit MYR=MY
tacked on 0.1% each.
The Taiwan dollar strengthened 0.1% ahead of September
export orders data, due later in the day.
Although Taiwan's Ministry of Economic Affairs is expecting
a 6%-8.1% year-on-year decline in exports, there are hopes for a
gradual recovery in the coming months due to the start of the
year-end festive season and rising demand for new technologies
including 5G technology.
Indian financial markets were closed on Monday for a
holiday.

CURRENCIES VS U.S. DOLLAR

Change on the day at 0607 GMT
Currency Latest bid Previous day Pct Move
Japan yen 108.470 108.42 -0.05
Sing dlr 1.362 1.3641 +0.12
Taiwan dlr 30.577 30.611 +0.11
Korean won 1174.000 1181.5 +0.64
Baht 30.260 30.3 +0.13
Peso 51.170 51.24 +0.14
Rupiah 14110.000 14139 +0.21
Ringgit 4.183 4.185 +0.05
Yuan 7.074 7.0810 +0.09

Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 108.470 109.56 +1.00
Sing dlr 1.362 1.3627 +0.02
Taiwan dlr 30.577 30.733 +0.51
Korean won 1174.000 1115.70 -4.97
Baht 30.260 32.55 +7.57
Peso 51.170 52.47 +2.54
Rupiah 14110.000 14375 +1.88
Rupee 71.140 69.77 -1.93
Ringgit 4.183 4.1300 -1.27
Yuan 7.074 6.8730 -2.85


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