EM ASIA FX-Asian currencies weaken as dollar rises after Fed minutes

(Adds text, updates prices)

By Patturaja Murugaboopathy

Feb 22 (Reuters) - Asian currencies languished against the

dollar on Thursday after minutes of the Federal Reserve's

January meeting showed policymakers were more confident of the

need to keep raising interest rates.

The Federal Reserve's rate-setting committee showed more

confidence in the economic outlook at its last policy meeting,

with most believing that inflation would perk up.

The dollar, which was hit recently by a barrage of bearish

factors such as worries about U.S. budget deficit and pursuance

of a weaker dollar policy, rebounded this week thanks to rising

U.S. Treasury yields.

The 10-year U.S. Treasury yield hit more than four-year

highs on Thursday and was creeping towards the psychological

level of 3 percent - which analysts say would drive investors

away from risky assets such as emerging Asian currencies.

"We do not rule out the possibility that Fed could revise

its dots projection slightly upwards for 2019 and for its

terminal rate," said Saktiandi Supaat, head of FX research at

Maybank in Singapore, in a report, referring to the Fed's

expectations for its rate path.

"The lead up to next FoMC meeting in Mar could continue to

see bouts of USD strength."

The South Korean won, Thai baht ,

Indonesian rupiah and the Malaysian ringgit -

all shed about half a percent or more on the day, hurt by

narrowing gap between the local bond yields and U.S. Treasury

yields.

Minutes from the last policy meeting of India's central bank

didn't help the rupee as they showed increasing concern among

members about accelerating inflation, undermining the rupee

and local bonds.

China's yuan eased against the U.S. dollar on

Thursday, the first trading day after long Lunar New Year

holiday, following a much weakened official guidance rate and

strength in the greenback.

On the other hand, the Japanese yen gained as

speculation of a faster pace of U.S. rate hikes soured

investors' risk appetites and dented equities.

Investors' growing aversion to riskier regional assets was

evident in rising foreign outflows.

Exchange data from seven Asian exchanges including India,

Indonesia and South Korea showed foreigners have sold $8.2

billion in equities so far this month, after buying over $7

billion in January.

Also a recent poll showed sentiment towards most emerging

Asian currencies soured further in the last two weeks.

The following table shows rates for Asian currencies against

the dollar at 0542 GMT.

CURRENCIES VS U.S. DOLLAR

Change as of

0542 GMT

Currency Latest Previou Pct

bid s day Move

Japan yen 107.410 107.76 +0.33

Sing dlr 1.325 1.3234 -0.08

Taiwan dlr 29.288 29.245 -0.15

Korean won 1083.600 1076.2 -0.68

Baht 31.600 31.484 -0.37

Peso 52.100 52.1 +0.00

Rupiah 13670.00 13618 -0.38

0

Rupee 64.990 64.76 -0.36

Ringgit 3.915 3.9 -0.38

Yuan 6.349 6.3450 -0.06

Change so far in

2018

Currency Latest End Pct

bid 2017 Move

Japan yen 107.410 112.67 +4.90

Sing dlr 1.325 1.3373 +0.97

Taiwan dlr 29.288 29.848 +1.91

Korean won 1083.600 1070.50 -1.21

Baht 31.600 32.58 +3.10

Peso 52.100 49.93 -4.17

Rupiah 13670.00 13565 -0.77

0

Rupee 64.990 63.87 -1.72

Ringgit 3.915 4.0440 +3.30

Yuan 6.349 6.5069 +2.49

(Reporting by Patturaja Murugaboopathy in Bengaluru; Additional

Reporting by Gaurav Dogra; Editing by Kim Coghill)