* Rupiah eases, cenbank expected to cut rates on Thursday
* Korean won slips ahead of BOK policy meeting
* Rising crude weighs on rupee, rupiah
(Adds text, updates prices)
By Rashmi Ashok
July 17 (Reuters) - Emerging Asian currencies weakened
against a firmer dollar on Wednesday, as robust U.S. retail
sales trimmed chances of aggressive policy easing by the Federal
Reserve.
U.S. retail sales rose more than expected in June, data
showed on Tuesday, tempering expectations of a 50 basis point
cut in July that markets had earlier expected. "The surprise retail sales indicator in the United States is
putting a big question mark on the number of interest rate cuts
the Fed can get away with," Alfonso Esparza, senior market
analyst at OANDA, said in a note.
"A July rate cut of 25 basis points is fully priced in, but
improving fundamentals could give some breathing room to the Fed
despite the wishes of the White House," he said.
The Philippine peso PHP= was the biggest decliner, off
0.4% against the greenback.
Rising crude prices stepped up pressure on the currencies of
major net oil importers, with the Indian rupee INR=IN and the
Indonesian rupiah IDR=ID both weakening.
The rupiah fell for a second session, ahead of a central
bank meeting due on Thursday.
Bank Indonesia (BI) Governor Perry Warjiyo has been hinting
at a possible rate cut recently, saying "there is room to lower
the rate" after a positive year for the rupiah.
With Fed Chairman Jerome Powell all but cementing a rate cut
in July and Indonesian President Joko Widodo stepping up
pressure on the government to spur growth, a majority of
analysts polled by Reuters expected a rate cut on Thursday.
UNCERTAINTY HURTS WON
The trade-sensitive Korean won slid 0.2%, after U.S.
President Donald Trump said on Tuesday the United States "still
has a long way to go" to conclude a trade deal with China and
threatened additional tariffs if needed. A possible rate cut by the Bank of Korea at its policy
review on Thursday also weighed on the currency, which is the
region's worst performer this year with a decline of 5.5%.
"The trade spat with Japan exacerbating sluggish trade
conditions, diminishing fiscal space and deteriorating domestic
demand may tip the BOK into a rate cut sooner rather than later;
and perhaps as soon as this week," analysts at Mizuho Bank said
in a note.
South Korea's exports have been hit by the Sino-U.S. trade
war and investors are also bracing for the impact of Japan's
export curbs to Korea. Furthermore, domestic demand has
moderated, adding to the central bank's worries.
The following table shows rates for Asian currencies against
the dollar at 0459 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 108.190 108.22 +0.03
Sing dlr 1.360 1.3582 -0.15
Taiwan dlr 31.060 31.042 -0.06
Korean won 1180.000 1177.6 -0.20
Baht 30.900 30.89 -0.03
Peso 51.080 50.89 -0.37
Rupiah 13960.000 13930 -0.21
Rupee 68.805 68.71 -0.14
Ringgit 4.114 4.11 -0.10
Yuan 6.883 6.8760 -0.10
Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 108.190 109.56 +1.27
Sing dlr 1.360 1.3627 +0.18
Taiwan dlr 31.060 30.733 -1.05
Korean won 1180.000 1115.70 -5.45
Baht 30.900 32.55 +5.34
Peso 51.080 52.47 +2.72
Rupiah 13960.000 14375 +2.97
Rupee 68.805 69.77 +1.40
Ringgit 4.114 4.1300 +0.39
Yuan 6.883 6.8730 -0.14