EM ASIA FX-Asian currencies climb on trade optimism, hopes over stable yuan

(Adds text, updates prices)

By Patturaja Murugaboopathy

Feb 20 (Reuters) - Asian currencies strengthened against the

dollar on Wednesday as hopes for a Sino-U.S. trade deal

continued to build.

President Donald Trump said on Tuesday that trade talks with

China were going well and suggested he was open to pushing off

the deadline to complete negotiations, saying March 1 was not a

"magical" date.

The yuan and other Asian currencies were also bolstered by a

media report on Tuesday that the United States was seeking to

secure a pledge from China that it will not devalue its currency

as part of a trade deal.

"A stable yuan could help to shore up sentiment on EM

currencies in the region alongside a lower chance of competitive

devaluation," said Zhu Huani, an economist at Mizuho Bank in a

note.

The yuan rose as much as 0.6 percent against the

dollar, its biggest intra-day gain in more than a month.

The Thai baht and the South Korean won,

both gained about 0.5 percent. The baht touched its highest

level against the dollar since November 2013 on Wednesday.

A fall in U.S. bond yields also propped up regional assets.

The benchmark 10-year U.S. Treasury yield fell for

the second consecutive day, ahead of the release of minutes from

the Federal Reserve's January policy-setting meeting.

New York Fed President John Williams told Reuters he was

comfortable with the level U.S. interest rates are at now and

that he sees no need to raise them again unless economic growth

or inflation shifts to an unexpected higher gear.

The Fed's caution over further rate hikes has given emerging

market currencies some reprieve this year, after sharp declines

in 2018.

Regional central banks are expected to soften their policy

stance this year as they face less pressure to defend their

currencies and are facing higher capital inflows.

China's central bank has been loosening policy since

mid-2018 and India unexpectedly cut rates in February. Both are

expected to ease further in coming months.

A Reuters poll showed Indonesia's central bank will keep its

policy rates on hold on Thursday. The central bank hiked its

rates six times in 2018, the highest in the region.

The Indonesian rupiah and the Malaysian ringgit

both were up 0.3 percent each, on Wednesday.

The following table shows rates for Asian currencies against

the dollar at 0536 GMT.

CURRENCIES VS U.S. DOLLAR

Change on the day at

0536 GMT

Currency Latest Previous Pct

bid day Move

Japan yen 110.800 110.61 -0.17

Sing dlr 1.352 1.3528 +0.07

Taiwan dlr 30.805 30.846 +0.13

Korean won 1122.30 1128.2 +0.53

0

Baht 31.070 31.24 +0.55

Peso 52.110 52.09 -0.04

Rupiah 14055.0 14097 +0.30

00

Rupee 71.220 71.34 +0.17

Ringgit 4.068 4.08 +0.29

Yuan 6.724 6.7600 +0.54

Change so far in

2019

Currency Latest End 2018 Pct

bid Move

Japan yen 110.800 109.56 -1.12

Sing dlr 1.352 1.3627 +0.80

Taiwan dlr 30.805 30.733 -0.23

Korean won 1122.30 1115.70 -0.59

0

Baht 31.070 32.55 +4.76

Peso 52.110 52.47 +0.69

Rupiah 14055.0 14375 +2.28

00

Rupee 71.220 69.77 -2.04

Ringgit 4.068 4.1300 +1.52

Yuan 6.724 6.8730 +2.22

(Reporting By Patturaja Murugaboopathy; Editing by Kim

Coghill)