REFILE-EM ASIA FX-Indonesian rupiah leads gainers as Middle East tensions recede

(Corrects to recast paragraph 1, add para 2) * Rupiah aided by cenbank comments on helping appreciation * Lower oil prices benefit units of net importers * S. Korean won weakens after strong show in previous session By Aby Jose Koilparambil Jan 10 (Reuters) - The Indonesian rupiah hit its highest levels in more than 18 months on Friday after the country's central bank said it will allow the currency to strength and as most Asian currencies rose on easing U.S.-Iran tensions. The rally set the rupiah, Korean won and other currencies for a close well off lows hit earlier this week, when investors rushed into the safety of the Japanese yen and gold following missile attacks from Iran targeting U.S. forces in Iraq. "Markets are a bit more energised as the Middle East tensions have not aggravated over the past day or so. The investors are back in favour of riskier assets," said Chang Wei Liang of DBS Bank. Oil prices extended losses in a sigh of relief for net importers. The Indonesian rupiah led the gainers, firming as much as 0.7% to its strongest level since April 2018. The Indian rupee gained 0.2% to strike its firmest point in three weeks and was set to gain about a percent for the week. The Malaysian ringgit strengthened 0.3%, aided by strong domestic data. Malaysia's industrial production rose 2% in November from a year earlier, recovering from its slowest growth pace in six years the previous month, government data showed on Friday. The Thai baht, the Singapore dollar and the Taiwan dollar firmed about 1% each. China's yuan was steady but hovered around five-month highs and was on track for its third straight weekly gain ahead of the much-anticipated signing of the Phase 1 trade deal between the United States and China. Meanwhile, the Korean won weakened as much as 0.4% after rising about a percent in the previous session. The currency, however, is set to post its first weekly gain in three. RUPIAH GAINS The rupiah's strongest level during the session also marked the unit's biggest intraday percentage gain in more than four months and the currency is set to gain about 1.3% for the week, its best weekly performance in a year. A senior official of Bank Indonesia official told Reuters that it was not targeting any level for rupiah appreciation and also confirmed a media report that the central bank would allow the rupiah to strengthen in line with fundamentals. "It's quite clear from their comments that they are not going to stand in the way of further rupiah appreciation," said Khoon Goh, head of Asia Research at ANZ. "(The bank's) view is still that the rupiah is undervalued, and if you look at the Indonesian macro fundamentals, they're pretty stable...the rupiah offers very attractive yields and that continues to be very attractive for investors." CURRENCIES VS U.S. DOLLAR Change on the day at 0608 GMT Currency Latest bid Previous day Pct Move Japan yen 109.550 109.51 -0.04 Sing dlr 1.350 1.3513 +0.13 Taiwan dlr 29.981 30.008 +0.09 Korean won 1160.000 1159.1 -0.08 Baht 30.260 30.28 +0.07 Peso 50.640 50.69 +0.10 Rupiah 13740.000 13845 +0.76 Rupee 71.090 71.21 +0.17 Ringgit 4.075 4.088 +0.32 Yuan 6.931 6.9324 +0.03 Change so far in 2020 Currency Latest bid End 2019 Pct Move Japan yen 109.550 108.61 -0.86 Sing dlr 1.350 1.3444 -0.39 Taiwan dlr 29.981 30.106 +0.42 Korean won 1160.000 1156.40 -0.31 Baht 30.260 29.91 -1.16 Peso 50.640 50.65 +0.02 Rupiah 13740.000 13880 +1.02 Rupee 71.090 71.38 +0.41 Ringgit 4.075 4.0890 +0.34 Yuan 6.931 6.9632 +0.47 (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Rashmi Aich)