January 3, 2019 / 5:28 AM / 8 months ago

EM ASIA FX-Most Asian currencies weaken as growth fears set off 'flash crash'

    * Japanese yen surges 1.6 pct
    * Korean won weakens as much as nearly 1 pct
    * Philippine inflation data due Friday

 (Adds text, updates prices)
    By Niyati Shetty
    Jan 3 (Reuters) - Most Asian currencies softened against the
dollar on Thursday, with the Korean won leading declines, as
wary investors dashed to safer assets amid deepening global
growth risks. 
    The won weakened as much as 0.9 percent at one
point to 1,128.40 per dollar, its lowest in two weeks, before
paring some losses. 
    Aggravating worries about cooling global growth, Apple Inc
 on Wednesday issues a rare revenue warning and cut its
quarterly sales forecast, citing slowing growth in emerging
markets and weak sales in China.
    The news helped trigger a 'flash crash' in currency markets,
with the Japanese yen soaring 1.6 percent versus the
greenback, which has been hobbled by a U.S. government shutdown.

   "Emerging market currencies weakened amid intensified risk
aversion," said Qi Gao, FX Strategist (EM Asia) at Scotiabank.
"The yen rallied as it is a traditional safe-haven currency."
    On Wednesday, data showed weaker factory activity across
much of Asia in December as the Sino-U.S. trade war dampened
export demand.
    The Taiwan dollar and the Indian rupee
fell 0.3 percent each, while the Chinese yuan and the
Malaysian ringgit were marginally weaker. 
    Elsewhere, the Philippine peso ticked down ahead
of inflation data due on Friday. 
    Inflation is expected to slow to a six-month low in December
on easing food and fuel prices, a Reuters poll showed, raising
the chances of the central bank leaving interest rates unchanged
this year. 
    Bangko Sentral ng Pilipinas left its key rate on hold in
December after five successive rate hikes. 

    The rupiah was marginally lower versus the dollar
after December inflation cooled.
    Bank Indonesia has less need to hike rates again given that
inflation appears well-contained and dollar weakness is taking
pressure off the rupiah, Mizuho Bank said in a note to clients. 
    The central bank governor said on Wednesday that he expects
the rupiah's exchange rate to be more stable this year compared
with 2018.
    Last year, the rupiah plunged to its weakest since the Asian
financial crisis 20 years ago, before recovering towards the end
of the year on increased capital inflows. 

    The following table shows rates for Asian currencies against
the dollar at 0502 GMT.    
 Currency                   Latest bid  Previous day  Pct Move
 Japan yen                  107.150     108.87        +1.61
 Sing dlr                   1.365       1.3663        +0.10
 Taiwan dlr                 30.895      30.794        -0.33
 Korean won                 1128.300    1119          -0.82
 Baht                       32.270      32.25         -0.06
 Peso                       52.540      52.515        -0.05
 Rupiah                     14465.000   14445         -0.14
 Rupee                      70.410      70.17         -0.34
 Ringgit                    4.140       4.135         -0.12
 Yuan                       6.875       6.8620        -0.19
 Change so far in 2019                                
 Currency                   Latest bid  End 2018      Pct Move
 Japan yen                  107.150     109.56        +2.25
 Sing dlr                   1.365       1.3627        -0.16
 Taiwan dlr                 30.895      30.733        -0.52
 Korean won                 1128.300    1115.70       -1.12
 Baht                       32.270      32.55         +0.87
 Peso                       52.540      52.58         +0.08
 Rupiah                     14465.000   14375         -0.62
 Rupee                      70.410      69.77         -0.91
 Ringgit                    4.140       4.1300        -0.24
 Yuan                       6.875       6.8730        -0.03

 (Reporting by Niyati Shetty in Bengaluru; Editing by Kim
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