June 15, 2017 / 6:37 AM / a year ago

EM ASIA FX- Most Asian currencies edge up as U.S. inflation data dents dollar

 (Adds details, updates prices)
    By Susan Mathew
    June 15 (Reuters) - Most Asian currencies edged higher on
Thursday, buoyed by a retreating dollar as U.S. inflation data
was weaker than expected, leaving investors doubting there will
be a third rate hike this year by the Federal Reserve.
    A Washington Post report saying a special counsel is
investigating U.S. President Donald Trump for possible
obstruction of justice added to the weakness in the U.S.
    The dollar index, which tracks the greenback against
a basket of six major rivals, was down 0.02 percent at 0544 GMT.
    The U.S. consumer Price Index dipped an unexpected 0.1
percent in May, and retail sales recorded their biggest drop in
16 months, suggesting a softening in domestic demand.

    But the Fed went on to raise the benchmark rate for the
second time in three months, and also forecasted one more rise
this year with its rate-setting committee holding the view that
a recent softness in inflation as largely transitory.

    "I take the view that the Fed is on a normalization path.
Our view is that they have moved from 1 hike per year in 2015
and 2016 to 1 hike per quarter this year," said Philip Sung Seng
Wee, DBS senior currency economist.
     Lifting the benchmark lending rate by a quarter percentage
point to a target range of 1 percent to 1.25 percent, Chair
Janet Yellen brushed off the recent mixed data on the back of a
robust labour market.
    Regional currencies were largely up with the Thai baht
 at near two-year highs, adding 0.13 percent, while the
Malaysian ringgit gained 0.07 percent, hitting its
highest in 6 months.
    The South Korean won rose 0.08, while the Chinese
 yuan edged up 0.1 percent. 
    China's central bank left interest rates for open market
operations unchanged on Thursday, unfazed by a rate hike by the
U.S. Fed.
     Some traders in China had opined that the People's Bank of
China had decided to "synch" its moves with those of the Fed in
a bid to reduce persistent depreciation pressure on the
    On the other hand, the Singapore dollar slid 0.13
percent, snapping two gaining days.

    The Indonesian rupiah inched up to touch a more
than one-month high of 13,270 to the dollar,  but then the gain
was erased. 
    In May, Indonesia's exports and imports surged more than
expected, but the trade balance was smaller than anticipated,
the statistics bureau said on Thursday
    After 0700 GMT Thursday, Indonesia's central bank is
expected to keep its benchmark interest rate unchanged at 4.75
 Change on the day at 0544 GMT                         
 Currency                    Latest bid  Previous day  Pct Move
 Japan yen                   109.680     109.56        -0.11
 Sing dlr                    1.377       1.3753        -0.13
 Taiwan dlr                  30.237      30.230        -0.02
 Korean won                  1123.000    1123.9        +0.08
 Baht                        33.870      33.915        +0.13
 Peso                        49.505      49.505        +0.00
 Rupiah                      13280.000   13280         +0.00
 Rupee                       64.280      64.30         +0.02
 Ringgit                     4.253       4.256         +0.07
 Yuan                        6.794       6.7943        +0.01
 Change so far                                         
 Currency                    Latest bid  End 2016      Pct Move
 Japan yen                   109.680     117.07        +6.74
 Sing dlr                    1.377       1.4490        +5.22
 Taiwan dlr                  30.237      32.279        +6.75
 Korean won                  1123.000    1207.70       +7.54
 Baht                        33.870      35.80         +5.70
 Peso                        49.505      49.72         +0.43
 Rupiah                      13280.000   13470         +1.43
 Rupee                       64.280      67.92         +5.66
 Ringgit                     4.253       4.4845        +5.44
 Yuan                        6.794       6.9467        +2.25
 (Reporting by Susan Mathew in Bengaluru)
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