EM ASIA FX-Solid dollar hits Asia FX; Singapore dlr at 1-mth low on mixed data
* Singapore dlr fails to maintain brief rebound after GDP
* Singapore April output -8.7 pct y/y, misses forecasts
* Yuan dips as c.bank sets midpoint at 3-week low
* Won hits 2-week low, offshore funds sell after holiday
(Adds text, updates prices)
By Jongwoo Cheon
SEOUL, May 26 (Reuters) - Most emerging Asian currencies
extended losses on Tuesday with the Singapore dollar slipping to
one-month lows despite robust growth data, as the dollar was
broadly stronger on U.S. rate hike views and Greece's debt
problems.
The Singapore dollar was also undermined by weak
industrial production data.
China's yuan slid for a second consecutive
session after the central bank set the daily midpoint guidance
rate to a three-week low. South Korea's won
touched a two-week trough on catch-up selling after a holiday.
The U.S. dollar was well bid, hitting a near
one-month peak against a basket of six major currencies in
holiday-thin trading, as comments from Federal Reserve Chair
Janet Yellen continued to resonate with greenback bulls.
Financial markets in the United States and Britain were
closed for holidays.
Yellen on Friday made clear that the U.S. central bank was
set to raise interest rates this year. Rising U.S. borrowing
costs usually erodes the allure of higher yields in emerging
Asia.
The greenback found further support from a weak euro as
Greece said it needed aid urgently in order to make good on its
debt obligations.
"Asian units are to remain soft for now," said Suresh Kumar
Ramanathan, head of regional interest rate and FX strategy at
CIMB Investment Bank in Kuala Lumpur.
"Yellen-driven USD euphoria is still at play, the effect has
not tapered off."
Investors were keeping an eye on U.S. economic data such as
durable goods orders due later in the day for further clues on
the Fed's policy path. Yellen stressed that incoming data will
be vital in deciding the pace of the tightening process.
Fide Vice Chair Stanley Fischer on Monday said the process
of returning to more normal levels of interest rates will take a
few years.
Most analysts believe emerging Asian currencies are unlikely
to rebound strongly, especially as the Fed remains committed to
rate increases.
"We see the USD correction to be over and USD to strengthen
vs Asia," said Sean Yokota, head of Asia strategy for
Scandinavian bank SEB in Singapore.
Yokota said the risks of a delay in U.S. rate hikes had been
priced in emerging Asian currencies from mid-April to mid-May
when regional units rose.
SINGAPORE DOLLAR
The Singapore dollar lost as much as 0.4 percent to 1.3468
per the U.S. dollar, its weakest since April 23.
Singapore's industrial output in April fell 8.7 percent from
a year earlier, much worse than expectations.
Earlier, the city-state's currency briefly turned firmer
after data showed first quarter gross domestic product grew
faster than initially estimated. That boosted the case for the
central bank to hold off from additional monetary policy easing
later this year, economists said.
The currency, however, didn't achieve much momentum due to
broad strength in the greenback.
"The better GDP should offset the weaker inflation print to
some degree but it seems a weaker USD trend is going to be
needed to push USD/SGD back down through 1.3400," said Jonathan
Cavenagh, senior FX strategist with Westpac in Singapore.
Singapore's consumer prices recorded their biggest
year-on-year drop in five years in April, a separate data showed
on Monday.
WON
The won slid as much as 0.8 percent to 1,098.9 per dollar,
its weakest since May 13, as offshore funds sold the currency.
South Korea's financial markets were closed on Monday to
mark Buddha's Birthday when its Asian peers fell.
The won pared some of the losses as local exporters bought
it for month-end settlements.
Such corporate demand is likely to keep the won stronger
than 1,100, traders said.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0500 GMT
Currency Latest bid Previous day Pct Move
Japan yen 121.83 121.57 -0.21
Sing dlr 1.3462 1.3418 -0.33
Taiwan dlr 30.543 30.571 +0.09
Korean won 1098.00 1090.10 -0.72
Baht 33.62 33.57 -0.15
Peso 44.66 44.62 -0.09
Rupiah 13188.00 13183.00 -0.04
Rupee 63.72 63.56 -0.25
Ringgit 3.6170 3.6145 -0.07
Yuan 6.2041 6.2020 -0.03
Change so far in 2015
Currency Latest bid End prev year Pct Move
Japan yen 121.83 119.66 -1.79
Sing dlr 1.3462 1.3260 -1.50
Taiwan dlr 30.543 31.718 +3.85
Korean won 1098.00 1099.30 +0.12
Baht 33.62 32.90 -2.14
Peso 44.66 44.72 +0.15
Rupiah 13188.00 12380.00 -6.13
Rupee 63.72 63.03 -1.08
Ringgit 3.6170 3.4965 -3.33
Yuan 6.2041 6.2040 -0.00
(Editing by Shri Navaratnam)
