EMERGING MARKETS-Thai baht firms more than 1% on easing of quarantine rules

* Most other Asian currencies decline * Thai baht scales over two-week high * South Korea's won hits over 1-year low * S.Korea base rate unchanged at 0.75% By Sameer Manekar Oct 12 (Reuters) - While most Asian currencies weakened on Tuesday, Thailand's baht gained more than 1% to stand at its strongest in over two-weeks after the government eased quarantine rules for visitors from low-risk countries in a bid to revive its key tourism sector. South Korea's won slipped 0.5% to hit its lowest in more than a year, and equities lost nearly 2%, falling to their lowest this year after the central bank kept interest rates unchanged. Trying to keep the economic recovery on track while containing a surge in private sector debt, the Bank of Korea held the benchmark interest rate at 0.75%, as expected by a Reuters poll, after its first rate hike in nearly three years in August. Analysts at Capital Economics expect BoK to make two further 25 basis points hikes by the third-quarter next year, with another in early 2023. Writing in a note, they said recent data out of South Korea points to a decent recovery in the third-quarter, and solid progress on vaccination raises prospects for lifting of containment measures and a rebound in consumer spending over the quarter ahead. In Thailand, stocks advanced up to 0.8% and the baht firmed as much as 1.2% to hit its highest level since late September. Thailand's Prime Minister Prayuth Chan-ocha on Monday said the tourism-reliant country will end coronavirus quarantine rules for vaccinated visitors from 10 low-risk countries, including the United States, Singapore, and China from November. "The reaction on the recent Thai baht rally is largely due to the news of reopening, but I don't think it will extend the rally that much as fundamentals for the Thai economy remain weak," Poon Panichpibool, a market strategist at Krung Thai Bank. "It will be up to the direction of the U.S. dollar which will be weaker once the Fed begins tapering, with another factor being the foreign fund flows which the reopening theme might help," he said, adding that he expects the baht to end the year at 33-33.25 per dollar. Meanwhile, the U.S. dollar index, which measures the greenback against a basket of peers, was trading at 94.351 as of 0230 GMT, hovering near the one-year high of 94.504 touched at the end of last month. Investors are now focusing on U.S. inflation and retail sales numbers later this week, and are expecting the Federal Reserve to begin tightening policy next month. Elsewhere in Asia, the Taiwan dollar slipped 0.3% to its lowest since late-April, while equities slumped more than 1%. Among stocks, Indonesia's benchmark was up 0.7%, Philippine shares extended gains after clocking a sharp 3% rise in the previous session, while shares in Singapore were down more than half a percent. HIGHLIGHTS: ** Indonesian 10-year benchmark yields rise 3.1 basis points to 6.394% ** India's retail inflation likely fell to a five-month low in September - Reuters poll ** U.S. two-year Treasury yields leaps to a more than 18-month high Asia stock indexes and currencies at 0343 GMT COUNTRY FX RIC FX FX INDE STOCK STOCK DAILY YTD X S S YTD % % DAILY % % Japan +0.04 -8.8 <.N2 -0.93 2.87 4 25> China 7 EC> India 0.00 -3.0 <.NS 0.00 28.35 4 EI> Indones -0.08 -1.2 <.JK 0.54 8.62 ia 4 SE> Malaysi -0.02 -3.5 <.KL 0.44 -3.04 a 7 SE> Philipp +0.12 -5.4 <.PS 0.01 -0.21 ines 4 I> S.Korea 6 11> Singapo -0.06 -2.5 <.ST -0.64 8.78 re 7 I> Taiwan -0.36 +1.2 <.TW -1.13 11.68 0 II> Thailan +1.26 -10. <.SE 0.62 13.40 d 41 TI> (Reporting by Sameer Manekar in Bengaluru; Editing by Simon Cameron-Moore)