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EMERGING MARKETS-Buoyant U.S. dollar, yields push Asian FX into a sea of red

* Malaysian ringgit hits lowest since Jan 1998 * Singapore dollar hits lowest since June 2020 * Philippine peso on track for a sixth straight session of losses By Tejaswi Marthi Sept 7 (Reuters) - Currencies in emerging Asian markets were in a sea of red on Wednesday, with the Malaysian ringgit hitting a more than two-decade low after the greenback resumed its ascent and U.S. Treasury yields rose on views that the Federal Reserve will continue its aggressive policy tightening. A report overnight showed the U.S. services industry unexpectedly picked up last month, reinforcing the view that the economy is not in recession and giving the Fed leeway for another super-sized 75 basis-point rate rise on Sept. 21. The Malaysian ringgit fell 0.1% to hit its lowest level since the 1998 Asia financial crisis that saw a massive sell-off in Southeast Asian equities and currencies. "Elevated U.S. treasury yields amid a swath of corporate debt issuance, US services industry outperformance, coupled with signs of softening in oil prices despite OPEC+ token supply cut, likely added to upward pressures on the ringgit," Maybank analysts said. The strong services reading suggests that the U.S. economy can withstand further hikes, they added. The Philippine peso fell 0.3% to a record low and the Vietnamese dong also followed suit. The Singapore dollar skidded 0.3% to its lowest level in over two years. Currencies in the region have seen quite a sell-off as investors shifted to safe havens amid the uncertain global economic outlook, extended lockdowns in China and weakness in the yuan. The worsening energy crisis in Europe has also weighed heavily on Asian currencies. Stocks in the region took a beating as well on fears that the Fed will keep raising interest rates to tame inflation. Equities in Philippines lost 1.1%, while benchmark indexes in Singapore and Indonesia fell 0.5% each. Meanwhile, oil prices continued to fall after COVID-19 curbs in China and prospects of further rate hikes fanned fears of lower fuel demand growth. China's stringent zero-COVID policy has kept cities such as Chengdu, with 21.2 million people, under lockdown, curbing people movement and oil demand at the world's second-largest consumer. "Expanding COVID-19 lockdowns in China are a threat to demand. However, if demand proves resilient and China moves to re-open, given the low and flat to falling global crude inventory levels we see upside risk to oil prices persisting," said Adam Skelton, Senior Associate, Commodities Research at NAB. HIGHLIGHTS: ** Top losers on Philippines benchmark index are Ayala Land down 3.3%, Megaworld Corp down 3.2% and JG Summit, down 2.6% ** Top drags on Singapore's benchmark index are DFI Retail down 3%, Mapletree Trust down 1.8% and Jardine Cycle and Carriage, down 1.7% ** China's export growth weakened more than expected in August as surging inflation crippled overseas demand and fresh COVID curbs and heatwaves disrupted production, putting more pressure on the sputtering economy. Asia stock indexes and currencies at 0439 GMT COUNTRY FX RIC FX FX INDE STOCKS STOCKS DAILY % YTD % X DAILY YTD % % Japan -0.82 -20.0 <.N2 -1.05 -5.05 7 25> China EC> India -0.10 -6.99 <.NS -0.44 1.29 EI> Indonesi -0.23 -4.49 <.JK -0.51 9.34 a SE> Malaysia -0.07 -7.49 <.KL 0.10 -4.97 SE> Philippi -0.28 -10.9 <.PS -1.11 -6.84 nes 3 I> S.Korea 3 11> Singapor -0.18 -4.27 <.ST -0.51 2.69 e I> Taiwan -0.60 -10.4 <.TW -1.66 -20.78 8 II> Thailand -0.38 -9.24 <.SE -0.09 -1.52 TI> (Reporting by Tejaswi Marthi in Bengaluru; Editing by Kim Coghill)