EMERGING MARKETS-Indonesia leads Asia stocks, currencies higher as c.bank holds fire

* Taiwan central bank meeting later on Thursday * Malaysia govt announces $4.87 bln stimulus * Indonesia's rupiah up 0.4%, stocks over 1% March 18 (Reuters) - Indonesia led Asia's emerging stocks and currency markets higher on Thursday as the country's central bank as expected left its key policy rate unchanged following the U.S. Federal Reserve's pledge to keep interest rates near zero. Bank Indonesia (BI) said it will continue to intervene in the market to keep the rupiah stable as the currency comes under pressure from capital outflows. Meanwhile, Philippines and Singapore stocks rose around 1% after the U.S. central bank said it would not wind back stimulus despite a stronger U.S. economic outlook and an expected surge in inflation. The yields on benchmark 10-year Treasury note hit a 13-month high, helping the dollar index rise 0.2% and limiting gains in Asia's risk-sensitive currencies. The index had slumped 0.6% on Wednesday after the Fed's remarks on economic growth, with DBS analysts attributing the sell-off to profit-taking on gains made in the run up to the policy meeting. Indonesian stocks were up 1.2% after BI's decision. Analysts were expecting the central bank to keep its 7-day reverse repurchase rate unchanged at a record low of 3.50% as rising U.S. yields puts pressure on the currency. BI has cut rates by 150 basis points over six cuts since the pandemic started. Asia's higher-yielding bonds were also moving in tight ranges following the Fed decision. U.S. bond yields have been rising on expectations that a faster economic recovery could fuel inflation and prompt the Fed to start unwinding ultra-loose monetary policy. Citi analysts said a growing U.S. economy and higher inflation might "keep (the) U.S. curve steep and prevent lasting relief for Asia fixed income." Taiwan's central bank will hold its policy meeting later on Thursday, with interest rates expected to be left unchanged. The local dollar was flat through the day, and stocks closed nearly half a percent higher. The local dollar, which has strengthened over 6% in the year, has become a source of concern for the export-reliant economy that saw strong growth last year from demand for its technology products. Taiwan's central bank governor recently said the island may be labelled a currency manipulator by the United States, having met Washington's three main criteria for such a decision. Last week, data showed a big spike in currency intervention spending last year. In Malaysia, stocks and the ringgit were up less than half a percent. The government unveiled a fresh round of stimulus on Wednesday, totalling 20 billion ringgit ($4.87 billion). HIGHLIGHTS: ** Indonesian 10-year benchmark yields are down 0.6 basis points at 6.751% ** Malaysia to sell 4.5 bln ringgit government bonds ** Jardine Matheson Holdings Ltd, Genting Singapore Ltd led gains in Singapore Asia stock indexes and currencies at 0740 GMT COUNTRY FX RIC FX FX INDEX STOCKS STOCKS DAILY % YTD % DAILY % YTD % Japan -0.32 -5.44 1.01 10.10 China +0.06 +0.42 0.51 -0.29 India -0.04 +0.68 0.37 5.68 Indonesia +0.38 -2.30 1.18 6.22 Malaysia +0.27 -2.14 0.44 0.30 Philippines -0.27 -1.42 0.97 -7.13 S.Korea +0.58 -3.34 0.61 6.70 Singapore -0.17 -1.59 0.81 10.24 Taiwan -0.04 +0.60 0.44 10.56 Thailand +0.03 -2.60 0.55 8.70 ($1 = 4.1050 ringgit) (Reporting by Nikhil Kurian Nainan and Nikhil Subba in Bengaluru; Editing by Arun Koyyur)