EM ASIA FX-Asia FX rise after Trump offers little clarity on fiscal plans

Source : REUTERS
Last Updated: Thu, Jan 12, 2017 10:20 hrs

* Thai baht rises to its highest in nearly 2 months * Asia FX stronger in the wake of Trump's news conference * Dollar slips after Trump offers no fiscal policy details (Adds text, updates prices) SINGAPORE, Jan 12 (Reuters) - Asian currencies rose broadly on Thursday in the wake of U.S. President-elect Donald Trump's news conference, which offered little clarity on his future fiscal policies and disappointed dollar bulls. The Thai baht climbed to around 35.30 at one point, its strongest since mid-November. Traders said the baht rose due to short-covering, and was also supported by inflows into Thai equities. Most other Asian currencies rose, including the onshore Chinese yuan, which gained 0.4 percent. The South Korean won climbed 1.3 percent. Trump, who takes office on Jan. 20, did not elaborate on his pro-growth policies in a news conference on Wednesday, providing no details on tax cuts and infrastructure spending. Emerging Asian currencies could stay firm in the near term, given the possibility of further liquidation of long dollar positions, said Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore. This is especially the case since many emerging Asian currencies have relatively higher interest rates compared with the dollar, he said. "Keeping long positions in the dollar against emerging market currencies or Asian currencies comes with a cost," Okagawa said, adding that this can make it harder to stick with such bets if the chances of the dollar rising in the near term seem low. Asian currencies had retreated broadly after Trump's election win on Nov. 8, as U.S. bond yields jumped on expectations that Trump's proposals for infrastructure spending and tax cuts would prop up U.S. economic growth and inflation. Emerging Asian currencies have regained some ground this month, after a short-covering rally in the offshore Chinese yuan triggered some scaling back of bullish bets on the dollar. CURRENCIES VS U.S. DOLLAR Change on the day at 0420 GMT Currency Latest bid Previous Pct day Move Japan yen 114.49 115.41 +0.80 Sing dlr 1.4277 1.4267 -0.07 Taiwan dlr 31.730 31.935 +0.65 Korean won 1181.00 1196.40 +1.30 Baht 35.35 35.56 +0.60 Peso 49.530 49.625 +0.19 Rupiah 13288 13328 +0.30 Rupee 68.10 68.33 +0.35 Ringgit 4.4600 4.4700 +0.22 Yuan 6.9117 6.9360 +0.35 Change so far in 2017 Currency Latest bid End prev Pct year Move Japan yen 114.49 117.07 +2.25 Sing dlr 1.4277 1.4490 +1.49 Taiwan dlr 31.730 32.279 +1.73 Korean won 1181.00 1207.70 +2.26 Baht 35.35 35.80 +1.29 Peso 49.53 49.72 +0.38 Rupiah 13288 13470 +1.37 Rupee 68.10 67.92 -0.26 Ringgit 4.4600 4.4845 +0.55 Yuan 6.9117 6.9467 +0.51 (Reporting by Masayuki Kitano; Additional reporting by Satawasin Staporncharnchai in BANGKOK, IFR Markets' Catherine Tan; Editing by Jacqueline Wong)

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