EMERGING MARKETS-Asian stocks rise on China stimulus prospects, currencies firm

(.) * Most currencies, equities advance * Philippine stocks hit near 1-year high * Bank of Thailand keeps rates unchanged By John Biju Feb 7 (Reuters) - Most Asian equities advanced on Wednesday, as China's measures to support its ailing stock market boosted sentiment, while currencies gained after the dollar pulled back from a recent peak. MSCI's emerging market Asia index rose as much as 0.9% hitting its highest level since Jan. 3. Equities in South Korea climbed as much as 1.9% to touch a peak since Jan. 3. Stocks in the Philippines jumped 1.1% to hit a near one-year high. Asian equities were tracking gains in Chinese stocks , which jumped 1.4% after regulators announced further curbs on short selling and state investors said they were expanding their stock-buying plans. A news report stating President Xi Jinping was set to discuss the nation's stock market with financial regulators, also sparked optimism. However, there was no confirmation this had happened or what was discussed. "The support measures from the Chinese authorities will likely boost the market over the near term, which could also benefit the CNY as well as EM Asia FXs," said Poon Panichpibool, markets strategist at Krung Thai Bank. Continuous improvement in Chinese economic data will be needed for a further rise in the yuan (CNY) and other emerging market currencies, Panichpibool added. Meanwhile, Thailand's baht inched lower after the central bank left its key interest rate unchanged, as expected. It was last flat at 35.530 per U.S. dollar. The Bank of Thailand's (BOT) monetary policy committee decided to hold the one-day repurchase rate at 2.50%, resisting government pressure to reduce borrowing costs to help revive faltering growth. The BOT said it stood ready to adjust rates as appropriate. "Near-term, markets will be on the lookout for more signs of tension between the BOT and the government amid greater clamour for policy easing, and whether this impinges on the central bank's independence," Nicholas Chia, macro strategist at Standard Chartered said. Stocks in Bangkok rose 0.2%. Other currencies in the region rose after the U.S. dollar pulled back from a near three-month high and remained under pressure after a recent rally. The Philippine peso climbed 0.4%, while the Indonesian rupiah jumped 0.6%. Market participants are now awaiting fresh clues on when the U.S. Federal Reserve will cut rates, after a bumper jobs report last week and hawkish rhetoric from Chair Jerome Powell, saw markets pushing back expectations of rate cuts. Traders are currently pricing in a 21.5% chance of a cut in March, according to CME Group's FedWatch Tool, compared with a 68.1% chance at the start of the year. HIGHLIGHTS: ** China inflation data, Reserve Bank of India interest rate decision on investor's radar ** China's Jan new yuan loans seen surging on policy support ** Beijing calls for 'positive, objective, friendly' China policy from South Korea Asia stock indexes and currencies at 0749 GMT Japan +0.05 -4.60 <.N2 25> -0.11 7.94 China EC> India +0.12 +0.31 <.NS -0.17 0.74 EI> Indones +0.61 -1.50 <.JK -0.02 -0.37 ia SE> Malaysi +0.04 -3.59 <.KL -0.11 3.89 a SE> Philipp +0.36 -1.08 <.PS 1.11 5.89 ines I> S.Korea 11> Singapo +0.09 -1.76 <.ST 0.84 -2.73 re I> Taiwan -0.06 -1.99 <.TW - 0.92 II> Thailan +0.04 -3.84 <.SE 0.24 -1.09 d TI> (Reporting by John Biju in Bengaluru; Editing by Stephen Coates and Eileen Soreng)