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EM ASIA FX-Most Asian units set for weekly gains as trade tensions cool

Published 09/06/2019, 02:01 PM
Updated 09/06/2019, 02:10 PM
© Reuters.  EM ASIA FX-Most Asian units set for weekly gains as trade tensions cool
USD/MYR
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* Indian rupee & Thai baht set for weekly losses
* Korean won region's best performer this week
* Focus on U.S. jobs data due later

(Adds text, updates prices)
By Rashmi Ashok
Sept 6 (Reuters) - Most emerging Asian units rose on Friday,
as Sino-U.S. trade tensions dialled down and robust U.S.
economic data spurred investors' appetite for riskier assets.
Sentiment rose after the United States and China agreed to
hold official trade talks in October, while on Thursday, a
private survey showed U.S. services sector activity accelerated
in August and private employers boosted hiring. The Chinese onshore yuan CNY=CFXS posted marginal gains,
after initially opening a shade weaker. It is set to gain about
0.2% this week.
Yet again, the People's Bank of China set its midpoint fix
at a stronger than expected level, supporting the currency.
The Malaysian ringgit MYR= and Korean won KRW=KFTC both
gained 0.3%.
Most units are set to wrap the week with gains, apart from
the Thai baht THB=TH and the Indian rupee INR=IN .
Markets now await the release on a U.S. jobs report, which
is expected to show continued strength in its labour market. If
the data meets expectations, it could spur risk sentiment and
help the dollar. However, analysts caution that good data could play a
double-edged sword by undermining expectations of further
interest rate cuts by the U.S. Federal Reserve this year.
"As markets rally in expectation of a trade deal and jobs
data remain strong, the inclination to provide immediate
accommodation recedes, but a Fed pause in September will shock
the markets," analysts at DBS Group Research said in a note.

BAHT PLAYING SAFE HAVEN
The baht is set for a weekly loss of 0.2%, in contrast with
most peers. However, it was the sole gainer last week during the
largely risk-averse mood pervading markets.
"Due to the large current account surplus that Thailand
runs, it has taken on somewhat of a safe haven flavour," said
Sim Moh Siong, FX strategist at Bank of Singapore.
While Taiwan and South Korea both run current account
surpluses, neither have seen that translate into currency
strength.
This is due to capital outflows and partly because
historically both economies have been able to recycle the
current account surplus by domestic pension funds investing
abroad, Siong said.
Meanwhile, Thailand has seen some difficulty in recycling
its current account surplus, while its tourism sector has also
performed well, leading to sustained currency strength, he
added.

The following table shows rates for Asian currencies against the
dollar at 0545 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 106.980 106.92 -0.06
Sing dlr 1.383 1.3836 +0.05
Taiwan dlr 31.262 31.280 +0.06
Korean won 1196.700 1200.2 +0.29
Baht 30.630 30.555 -0.24
Peso 51.900 51.93 +0.06
Rupiah 14130.000 14145 +0.11
Rupee 71.695 71.84 +0.20
Ringgit 4.175 4.188 +0.31
Yuan 7.146 7.1499 +0.06

Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 106.980 109.56 +2.41
Sing dlr 1.383 1.3627 -1.46
Taiwan dlr 31.262 30.733 -1.69
Korean won 1196.700 1115.70 -6.77
Baht 30.630 32.55 +6.27
Peso 51.900 52.47 +1.10
Rupiah 14130.000 14375 +1.73
Rupee 71.695 69.77 -2.68
Ringgit 4.175 4.1300 -1.08
Yuan 7.146 6.8730 -3.81


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