EM ASIA FX-Yuan to see worst month since Aug devaluation ahead of SDR decision
* Onshore yuan at 3-month low; PBOC midpoint 3-month low
* Offshore yuan jumps on suspected intervention
* Rupee leads November Asia FX slides on capital outflows
(Adds text, updates prices)
By Jongwoo Cheon
SINGAPORE, Nov 30 (Reuters) - China's yuan was set on Monday
to suffer its largest monthly loss since August, when it was
devalued by the central bank, as markets wait to hear whether
the International Monetary Fund will the currency in its global
reserve basket.
Most emerging Asian currencies slumped on a strong dollar
and weak equity markets, especially in China. Regional
currencies were also on course for monthly declines as
expectations that the U.S. Federal Reserve will raise interest
rates next month gain traction.
The yuan earlier hit a three-month low of 6.3980
per dollar but erased most of its losses in volatile trade.
The People's Bank of China set the daily guidance rate
at 6.3962, the weakest since August.
The renminbi has slumped 1.2 percent against the dollar
this month, which would be the largest monthly depreciation
since a 2.6 percent fall in August, according to Thomson Reuters
data.
The IMF is widely expected to include the yuan in its
Special Drawing Rights reserve currency basket. The move is seen
as supporting the yuan in the longer term as central banks
gradually add yuan assets to their reserves.
Still, the move is unlikely to bolster the renminbi
immediately, analysts said.
"The market will be looking out for details of the
announcement, including any requirement for China to refrain
from currency interventions," analysts at OCBC Bank said in a
note.
China's central bank took various steps including market
intervention to curb the yuan's weakness, especially after the
yuan devaluation on Aug. 11. On Monday, the currency jumped in
offshore trade on suspected intervention.
Some analysts expected Beijing to allow further weakness in
the currency after it is formally included, given China's
slowing economy. That will drag on other emerging Asian
currencies, they added.
"Should the authorities allow the yuan to be more market
determined following SDR inclusion, this could see further
weakness given that the PBOC has been easing policy while the
U.S. Fed is set to hike interest rates at their next meeting,"
said Khoon Goh, senior FX strategist for ANZ in Singapore.
"A weaker yuan will have some spillover effects on Asian
currencies."
STORMY NOVEMBER
Emerging Asian currencies were poised to report monthly
losses in November on expectations of a U.S. liftoff at its next
policy meeting in mid-December.
India's rupee led regional depreciation with a 2.3
percent slide against the dollar this month, Thomson Reuters
data showed.
Foreign investors dumped Indian stocks and bonds after Prime
Minister Narendra Modi's BJP suffered a heavy defeat in Bihar
state's elections, raising concerns the government would
struggle to pass policy reforms.
The South Korean won slumped 1.5 percent this
month as foreign investors sold out of Seoul's stock market
.
Indonesia's rupiah has fallen 1.2 percent so far
November on corporate dollar demand for year-end payments. The
Singapore dollar has lost 0.8 percent on the yuan's
weakness.
The Thai baht has slipped 0.9 percent, while the
Philippine peso ended the month down 0.7 percent. Philippine
financial markets were closed for a holiday on Monday.
Investors are keeping an eye on Fed Chair Janet Yellen's
speech on Wednesday and October U.S. jobs data on Friday for any
clue on U.S. monetary policy.
In contrast, the European Central Bank is expected to add
monetary stimulus at its Thursday meeting. That may limit
downside in emerging Asian currencies.
Malaysia's ringgit bucked the regional depreciation
trend in November with a 0.8 percent gain.
The ringgit rose as a rebound in crude oil prices eased some
concerns over Malaysia's falling oil and gas revenues.
The currency also drew support from an agreement by the
debt-ridden state fund 1Malaysia Development Bhd to sell its
energy business to China General Nuclear Power Corporation in a
$2.3 billion cash deal. China will also buy more Malaysian
government bonds, Premier Li Keqiang was quoted as saying.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0520 GMT
Currency Latest bid Previous day Pct Move
Japan yen 122.70 122.75 +0.04
Sing dlr 1.4126 1.4125 -0.01
Taiwan dlr 32.681 32.815 +0.41
Korean won 1157.30 1153.00 -0.37
Baht 35.86 35.85 -0.03
Peso 47.15 47.15 +0.00
Rupiah 13835.00 13775.00 -0.43
Rupee 66.81 66.76 -0.07
Ringgit 4.2590 4.2600 +0.02
Yuan 6.3967 6.3952 -0.02
Change so far in 2015
Currency Latest bid End prev year Pct Move
Japan yen 122.70 119.66 -2.48
Sing dlr 1.4126 1.3260 -6.13
Taiwan dlr 32.681 31.718 -2.95
Korean won 1157.30 1099.30 -5.01
Baht 35.86 32.90 -8.25
Peso 47.15 44.72 -5.14
Rupiah 13835.00 12380.00 -10.52
Rupee 66.81 63.03 -5.65
Ringgit 4.2590 3.4965 -17.90
Yuan 6.3967 6.2040 -3.01
(Additional reporting by Swati Bhat in Mumbai; Editing by Eric
Meijer)