EM ASIA FX-Dollar retreat gives Asia FX short-lived painkiller; yuan rebounds

Last Updated: Tue, Nov 22, 2016 10:40 hrs

* PBOC fixing stronger, first time in 13 sessions * Won up on foreign bids; BlackRock sees Korea geopolitical risks * Taiwan dollar gains on equity inflows; importers limit upside (Adds text, updates prices) By Jongwoo Cheon SINGAPORE, Nov 22 (Reuters) - Most emerging Asian currencies rose on Tuesday as the dollar snapped its 10-day winning streak and investors took profit amid concerns over higher U.S. Treasury yields and the growing risk of trade protectionism. The Chinese yuan rebounded from a near 8-1/2-year low hit on Monday as the central bank set its daily guidance rate stronger for the first time in 13 sessions. South Korea's won led gains among regional units, with offshore funds unwinding bearish bets following weakness in the dollar. Gains in the yuan and the won powered the Taiwan dollar . The U.S. dollar retreated from a 13-1/2-year high against a basket of six major currencies. The greenback has rallied on rising U.S. Treasury yields that have been supported by expectations of increased fiscal spending and higher inflation in the United States under President-elect Donald Trump's administration. Higher Treasury yields have driven foreign investors out of emerging Asia. In addition, regional financial assets have come under further pressure from Trump's protectionist stance on trade. "EM/Asian currencies may see a brief reprieve in the short term but background concerns surrounding the incoming U.S. administration's posture towards trade agreements may keep the downside for USD-Asia shallow," said Emmanuel Ng, foreign exchange strategist at OCBC Bank, in a note. Trump on Monday outlined plans for his first day in office including a formal declaration of his intent to withdraw from the Trans-Pacific Partnership, or TPP, trade deal, which he called "a potential disaster for our country." Some Southeast Asian currencies eased with the Indonesian rupiah tracking lower government bond prices . WON The won earlier appreciated more than 1 percent as foreign investors were set to extend their buying spree in Seoul's main stock market for a fourth straight session. The South Korean currency pared some of its earlier gains as traders doubted the won would appreciate further. BlackRock's head of active investing for Asia said North Korea's nuclear threat and the risk of a presidential impeachment in the democratic South have turned the Korean peninsula into Asia's biggest unknown for global investors. TAIWAN DOLLAR The Taiwan dollar found further support as local shares jumped more than 1 percent on demand from foreign financial institutions. The currency pared some of its gains as local importers bought the U.S. dollar for payments around 31.850. The central bank has not been spotted intervening to stem the Taiwan dollar's appreciation, traders said. CURRENCIES VS U.S. DOLLAR Change on the day at 0410 GMT Currency Latest bid Previous day Pct Move Japan yen 110.69 110.77 +0.07 Sing dlr 1.4227 1.4241 +0.10 Taiwan dlr 31.863 32.000 +0.43 Korean won 1175.30 1186.60 +0.96 Baht 35.45 35.49 +0.12 Peso 49.830 49.830 +0.00 Rupiah 13445 13420 -0.19 Rupee 68.16 68.16 -0.00 Ringgit 4.4220 4.4170 -0.11 Yuan 6.8891 6.8944 +0.08 Change so far in 2016 Currency Latest bid End prev year Pct Move Japan yen 110.69 120.30 +8.68 Sing dlr 1.4227 1.4177 -0.35 Taiwan dlr 31.863 33.066 +3.78 Korean won 1175.30 1172.50 -0.24 Baht 35.45 36.00 +1.55 Peso 49.83 47.06 -5.56 Rupiah 13445 13785 +2.53 Rupee 68.16 66.15 -2.95 Ringgit 4.4220 4.2935 -2.91 Yuan 6.8891 6.4936 -5.74 (Reporting by Jongwoo Cheon; Additional reporting by Roger Tung in TAIPEI; Editing by Jacqueline Wong)

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