EMERGING MARKETS-Asian FX pare losses as dollar weakens after BOJ action

(.) * BOJ widens bond yield band * Singapore dollar reverses course * Yen rises 2.7% * China keeps LPRs unchanged By Harshita Swaminathan Dec 20 (Reuters) - Asian currencies traded mixed on Tuesday, with some currencies reversing course and moving higher after the Japanese central bank widened the band around its bond yield cap, which boosted the yen and weighed on the U.S. dollar. Singapore's dollar reversed after the Bank of Japan (BOJ) move, and rose as much as 0.4% to 1.3517 to the dollar, before paring gains to about 1.3555. The Indonesian rupiah also switched back and rose as much as 0.2% after the BOJ move, but gave up all those gains, and was last seen 0.2% lower. The BOJ, while holding rates steady, in a surprise move said it will allow long-term bond yields to rise more as it widened the band around its yield cap, a move that is being seen as a sign that more policy normalisation is in the offing. "The BOJ decision to widen the 10-year government bond yield ... it's affected the Japanese yen, in the way that Japanese yen appreciated further and that's really helped Asian currencies," said Poon Panichpibool, a markets strategist at Krungthai Bank. The yen rose 2.7% to 133.25 to the dollar, its best day since Nov. 10, putting pressure on the dollar index, which fell as much as 0.7% to 103.94, compared with 104.62 seen before the BOJ move. The BOJ's action took some of the focus off recession fears that carried over into Asia hours from the overnight session on Wall Street. While several Asian currencies such as the Thai baht and Malaysian ringgit were still weaker on the day due to broader recession fears, they were at higher levels than before the BOJ move. In China, the benchmark lending rate was left unchanged, as predicted by markets, but expectations of monetary policy easing are growing, as the country tries to shore up an economy battered by some of the most severe COVID-19 restrictions. Analysts at OCBC said there is still room for China to roll out monetary easing via quantity and price measures. China also reported five more COVID-19-related deaths for Monday, up from two deaths a day earlier, after the country significantly eased its COVID-19 restrictions earlier this month. The yuan was broadly stable, moving very marginally. Most Asian stock markets were down, tracking their counterparts on Wall Street. Markets in Jakarta and South Korea were down 0.8% and 0.9% respectively. HIGHLIGHTS: ** Indonesian central bank expected to scale down rate hikes to 25 basis points on Dec. 22, Reuters poll shows ** S. Korean central bank chief says biggest source of uncertainty over future oil prices and inflation was the war in Ukraine Asia stock indexes and currencies at 0419 GMT COUNTRY FX RIC FX FX YTD INDEX STOCKS STOCKS DAILY % DAILY YTD % % % Japan +2.82 -13.56 -2.36 -7.63 China -0.06 -9.03 -0.64 -15.18 India -0.07 -10.19 -0.85 5.24 Indonesia -0.16 -8.77 -0.84 2.14 Malaysia -0.23 -6.05 -0.29 -6.04 Philippines +0.02 -7.94 0.31 -9.67 S.Korea +0.23 -8.55 -0.94 -21.75 Singapore +0.07 -0.49 -0.35 3.89 Taiwan -0.04 -9.96 -1.36 -21.86 Thailand -0.24 -4.38 -0.66 -3.02 (Reporting by Harshita Swaminathan; Editing by Christopher Cushing)