* Asian currencies mostly higher, baht sets 8-month high
* Hunt for higher yields seen as supporting Asian currencies
* Investors may be shifting funds to Asia from Eastern
(Adds text, updates levels)
By Masayuki Kitano
SINGAPORE, July 22 (Reuters) - Most Asian currencies rose on
Tuesday, with the Indonesian rupiah holding firm ahead of the
official results of the country's presidential election, while
the Thai baht scaled an eight-month high.
Asian currencies had slipped late last week after the
downing of a Malaysian airliner over eastern Ukraine on Thursday
stoked geopolitical tension and sapped investors' appetite for
They have since regained their footing however, with market
participants saying Asian currencies seemed to be benefiting
from investor interest for relatively high-yielding assets,
despite lingering worries about geopolitical risks.
The Thai baht and the Indonesian rupiah have outperformed
over the past two days, with both currencies having risen about
0.9 percent versus the dollar so far this week.
The baht rose to as high as 31.82 versus the dollar
on Tuesday, its strongest level since last November.
"If you look at Thailand there have been some actual signs
of hefty inflows of funds, both in equities and in bonds," said
a trader for a Japanese bank in Singapore, referring to the
baht's recent strength.
Thai shares slipped 0.8 percent on Tuesday, after
finishing at their highest close in more than a year on Monday.
The baht has risen by more than 3 percent from a trough hit
in early June, having gained as Thailand's political tensions
eased after the military took power in May to end months of
Desmond Fu, an analyst for Western Asset Management in
Singapore, said investors may be shifting funds into Asia and
away from Eastern Europe due to the tensions in Ukraine, based
on a view that Asian assets offer attractive yields after taking
into account relative risks.
"I think people are generally more comfortable with Asia...
They think that on a risk-reward basis, Asia still offers decent
yield," he said.
Investor positioning may be exacerbating such a shift in
funds toward Asia, Fu said, adding that some investors may have
had an overweight position in Eastern European assets over the
past six months.
The rupiah rose 0.6 percent to 11,500 versus the dollar
ahead of the official results of Indonesia's
presidential election due later on Tuesday.
The rupiah has been supported in recent weeks as investors
bet on a win for Jakarta Governor Joko "Jokowi" Widodo, who is
perceived as more business-friendly than his rival, former
general Prabowo Subianto.
Both Jokowi and Prabowo had claimed victory in the election
held on July 9, but unofficial tallies from quick polls have
bolstered market expectations for a Jokowi win.
The rupiah held firm even after a top aide to Prabowo said
on Tuesday that the presidential candidate wants a two-week
delay in announcing the result of the election to allow
investigations into allegations of mass cheating.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0539 GMT
Currency Latest bid Previous day Pct Move
Japan yen 101.52 101.40 -0.12
Sing dlr 1.2400 1.2397 -0.02
Taiwan dlr 29.977 30.037 +0.20
Korean won 1023.90 1026.80 +0.28
Baht 31.82 31.94 +0.38
Peso 43.36 43.45 +0.21
Rupiah 11500.00 11567.00 +0.58
Rupee 60.19 60.31 +0.20
Ringgit 3.1760 3.1740 -0.06
Yuan 6.2058 6.2089 +0.05
Change so far in 2014
Currency Latest bid End prev year Pct Move
Japan yen 101.52 105.28 +3.70
Sing dlr 1.2400 1.2632 +1.87
Taiwan dlr 29.977 29.950 -0.09
Korean won 1023.90 1055.40 +3.08
Baht 31.82 32.86 +3.27
Peso 43.36 44.40 +2.39
Rupiah 11500.00 12160.00 +5.74
Rupee 60.19 61.80 +2.68
Ringgit 3.1760 3.2755 +3.13
Yuan 6.2058 6.0539 -2.45
(Reporting by Masayuki Kitano)