EM ASIA FX-Asian currencies in tight ranges as cbank decisions loom

By Shriya Ramakrishnan

* Philippine peso weakens for a second day * Malaysia July factory output below forecast * S. Korean won strengthens (Adds text, updates prices) By Shriya Ramakrishnan Sept 11 (Reuters) - Asian currencies clung to tight ranges on Wednesday as investors awaited directional cues from major central bank meetings although the prospect of fresh stimulus and signs of easing in Sino-U.S. trade tensions supported some export-focused units. Investor focus is now centred on to the European Central Bank's meeting on Thursday, which is expect to deliver a rate cut and set the tone for upcoming decisions by the U.S. Federal Reserve and the Bank of Japan next week. The Philippine peso extended its losses, falling 0.2% against the dollar to its lowest level in over a week after data on Tuesday showed the trade deficit widening. "Another interest rate cut by Bangko Sentral ng Pilipinas could compress real yields in the Philippines, potentially making onshore assets less attractive relative to regional peers with higher real yields," Han Tan, market analyst at FXTM said. "Still, the peso should find support over the remainder of 2019 from expected inflows in line with the government’s infrastructure spending plans." Tan said fresh stimulus globally would likely help prop up demand in some of the world’s biggest economies, which could have a positive spillover effect for the currencies of open and trade-dependent Asian economies. The South Korean won strengthened 0.2% to the dollar, buoyed by data which showed Asia's fourth-largest economy notched up a rare gain in exports for the first 10 days of this month. Capping the won's gains, however, were South Korean plans to file a complaint at the World Trade Organization over Japan's tighter export controls. The Indian rupee, which resumed trade after a holiday, edged lower, with investor focus shifting to inflation data due on Thursday. Economists polled by Reuters see retail inflation rising to a 10-month high in August on higher food prices, while staying below the central bank's medium-term target of 4%, prompting expectations for a rate cut next month. RINGGIT IN FOCUS The Malaysian Ringgit was marginally lower ahead of a monetary policy decision on Thursday. According to a Reuters poll, Malaysia's central bank is expected to keep its benchmark interest rate unchanged on Thursday, as it keeps room for potential easing later should global growth fall sharply. Amid a deterioration in the currency, foreign investors sold both Malaysian equities and debt securities by a total of 2.7 billion ringgit ($646.71 million) in August, reversing the buying trend in June and July, according to a note by UOB Group. The ringgit weakened 1.9% in August, and has lost about 1.1% so far this year. The Southeast Asian nation's industrial production index rose at its slowest pace in five years in July as mining output slowed, government data showed on Wednesday. CURRENCIES VS U.S. DOLLAR Change on the day at 0502 GMT Currency Latest bid Previous day Pct Move Japan yen 107.730 107.53 -0.19 Sing dlr 1.378 1.3797 +0.10 Taiwan dlr 31.208 31.230 +0.07 Korean won 1190.900 1193.3 +0.20 Baht 30.620 30.62 +0.00 Peso 52.130 52.02 -0.21 Rupiah 14050.000 14045 -0.04 Rupee 71.713 71.70 -0.02 Ringgit 4.175 4.17 -0.12 Yuan 7.112 7.1130 +0.01 Change so far in 2019 Currency Latest bid End 2018 Pct Move Japan yen 107.730 109.56 +1.70 Sing dlr 1.378 1.3627 -1.13 Taiwan dlr 31.208 30.733 -1.52 Korean won 1190.900 1115.70 -6.31 Baht 30.620 32.55 +6.30 Peso 52.130 52.47 +0.65 Rupiah 14050.000 14375 +2.31 Rupee 71.713 69.77 -2.71 Ringgit 4.175 4.1300 -1.08 Yuan 7.112 6.8730 -3.36 ($1 = 4.1750 ringgit) (Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Sam Holmes)