* Singapore Jan CPI +3.6 pct y/y; below expectations
* Won dips on offshore funds selling; exporters cap downside
* Rupiah edges down on local corp dlr demand
(Adds text, updates prices)
By Jongwoo Cheon
SINGAPORE, Feb 25 (Reuters) - The won slid on Monday as
investors worried about the impact of a fresh fall in the yen on
South Korea's export competitiveness while other emerging Asian
currencies came under pressure on weaker Chinese data.
The yen hit a 33-month low against the dollar as
speculation increased that the Japanese government was very
likely to name two strong supporters of aggressive monetary
easing to top posts at the Bank of Japan.
Investors were also keeping an eye on Federal Reserve
Chairman Ben Bernanke's comments later this week for clues on
whether and when the Fed may scale back its asset-buying
programme.
If the U.S. central bank steps back from its easing policy,
it will prompt investors to unwind long positions in emerging
Asian assets, traders said.
"The Fed and BOJ dynamics are important constraints to Asian
FX," said Sacha Tihanyi, senior currency strategist for
Scotiabank in Hong Kong.
Weaker Chinese purchasing managers data that showed the
country's vast manufacturing sector pulled back from two-year
highs also weighed on sentiment.
The Singapore dollar fell after the city-state reported a
slower-than-expected inflation rate in January, but later
recovered some losses.
Most emerging Asian currencies have eased so far this year
as the yen dropped and on concern that the Fed may wind down
monetary easing sooner than expected.
But one analyst said the regional units are unlikely to
weaken much further if the BOJ carries out actual easing.
"As we have gone through quite some sessions of correction
already, further reaction may be muted unless BOJ indeed embarks
on a new round of easing," said Frances Cheung, senior
strategist at Credit Agricole CIB in Hong Kong.
WON
The won eased as some offshore funds sold it on a weaker yen
and a retreat in China's HSBC flash purchasing managers' index
(PMI), traders said. Importers also bought dollars for payments.
The South Korean currency, however, recovered some of
earlier losses on exporters' demand for month-end settlements.
Domestic exporters are likely to snap up the won around
1,090 per dollar, traders said.
"Exporter deals are likely to support the won this week. But
the authorities may step in the market if the yen tumbles
further," said a senior foreign bank dealer in Seoul.
Seoul foreign exchange authorities have been expected to
intervene to protect the competitiveness of its export-oriented
firms. South Korea and Japan compete in key export markets.
SINGAPORE DOLLAR
Besides the inflation data, the currency also fell on profit
taking.
"The Singapore dollar may weaken more if the yen falls
further and the euro drops," said a senior Asian bank trader.
"It is possible to see 1.2410. But no more than that," said
the trader, noting that other emerging Asian currencies haven't
fallen much on the day.
The Singapore dollar has a 200-day moving average at 1.2408.
Once that level is broken again, it may weaken to 1.2465, the
38.2 percent Fibonacci retracement of its appreciation between
June and October, according to analysts. On Feb 21, it closed
weaker than the average for the first time since June.
Earlier on Monday, it hit 1.2407 to the U.S. dollar and
threatened to go past the average.
On Friday, stronger-than-expected growth data helped the
city-state's currency enjoy a 0.4 percent gain against the
greenback, its largest daily percentage appreciation since Jan.
10, according to Thomson Reuters data.
The Singapore dollar depreciated as investors covered
short-positions in the U.S. dollar before Singapore announced
its budget later in the day.
RUPIAH
The rupiah edged lower on month-end dollar demand from local
companies, while state-run lenders and foreign banks bought the
Indonesian currency, limiting its downside.
Investors have not responded yet to the government's
surprising nomination of the finance minister as the next
central bank governor.
Indonesia's president has unexpectedly nominated Finance
Minister Agus Martowardojo as the sole candidate to be the next
central bank governor of Southeast Asia's largest economy, a
parliament official told Reuters on Friday.
But Martowardojo ran into opposition on Monday, as one
member of a parliamentary commission that has the final word on
selection questioned his integrity and another doubted his grasp
of macroeconomics.
Some expected the appointment to support sentiment on
Indonesia, saying a change may well be order given the current
account deficit and the central bank's reluctance to raise
rates.
But traders doubt how much support the rupiah would receive
from the move.
"His background as a banker definitely made him more
familiar with handling inflation through rate policies," said a
Jakarta-based trader.
"But it is very complicated to gauge what is happening to
the rupiah. Now we are feeling the effect of the global currency
war. Imports increased in multitude due to cheap goods," said
the trader.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0710 GMT
Currency Latest bid Previous day Pct Move
Japan yen 94.25 93.49 -0.81
Sing dlr 1.2383 1.2372 -0.09
Taiwan dlr 29.655 29.658 +0.01
Korean won 1086.00 1084.70 -0.12
*Baht 29.84 29.86 +0.05
Peso 40.70 40.69 -0.01
Rupiah 9710.00 9708.00 -0.02
Rupee 54.05 54.18 +0.23
Ringgit 3.0990 3.1015 +0.08
Yuan 6.2338 6.2351 +0.02
Change so far in 2013
Currency Latest bid End prev year Pct Move
Japan yen 94.25 86.79 -7.92
Sing dlr 1.2383 1.2219 -1.32
Taiwan dlr 29.655 29.136 -1.75
Korean won 1086.00 1070.60 -1.42
Baht 29.84 30.61 +2.58
Peso 40.70 41.05 +0.87
Rupiah 9710.00 9630.00 -0.82
Rupee 54.05 54.99 +1.74
Ringgit 3.0990 3.0580 -1.32
Yuan 6.2338 6.2303 -0.06
* Financial markets in Thailand are closed for a holiday.
(Reporting by Jongwoo Cheon in SINGAPORE; Editing by Jijo
Jacob; Editing by Sanjeev Miglani)
