EM ASIA FX-S. Korea GDP shock hits won; most others weaken

(Corrects typo in "Korea" in first paragraph)
* S. Korean won weakens for fourth straight session
* Indonesia c. bank seen to keep rates on hold
* Yuan hits near 1-month low

By Shriya Ramakrishnan
April 25 (Reuters) - The won slipped to its weakest level in
more than two years on Thursday after South Korea posted an
unexpected contraction in its economy during the first quarter,
while strong gains in the dollar weighed on most other Asian
Gross domestic product (GDP) data released in early Asian
trading hours showed that South Korea's economy suffered its
worst quarter since the global financial crisis, as investments
and exports slumped in response to Sino-U.S. trade tensions and
cooling Chinese demand.
The South Korean won lost as much as 0.9 percent,
weakening to 1.161.4 per dollar, making it the worst performer
in the region on the day.
But broad dollar strength also put Asian untis under
"The break in the dollar index above the 98 level which is
closely watched by the market on a technical basis and with the
Korean GDP being much weaker than expected, it has created an
environment where markets are selling down Asian currencies,"
Khoon Goh, head of Asia research at ANZ Banking Group
(Singapore) said.
The dollar index which measures the greenback versus
a basket of six major peers, rose to as high as 98.189
overnight, its highest level since May 2017, largely propelled
by upbeat U.S. economic data and the euro's weakness.
Among other Asian currencies, the Indonesian rupiah
weakened for a second session, declining 0.4 percent to 14,150
per dollar.
Bank Indonesia is due to release its monthly monetary policy
decision later in the day, with a Reuters poll expecting them to
stand pat.
China's yuan weakened as much as 0.2 percent
against the dollar on the day, hitting its lowest level since
March 29. The currency however recovered slightly on dollar
selling by major state-run Chinese banks, traders said.
Investors are awaiting the release of U.S. first quarter GDP
data on Friday to gather clues on the health of the world's
largest economy amid its long-drawn retaliatory tariff war with
U.S. President Donald Trump on Wednesday said ongoing trade
talks between the United States and China were going well, but
few details have emerged.
The next round of talks are slated to begin April 30 in
Beijing, followed by further discussions starting May 8 in
The Thai baht dropped 0.3 percent against the
dollar to 32.06. A Thai central bank official said on Wednesday
that weaker exports could hurt the country's economic growth
this year, adding that manufacturers have been affected.

The following table shows rates for Asian currencies against
the dollar at 0533 GMT.
Currency Latest bid Previous day Pct Move
Japan yen 111.920 112.17 +0.22
Sing dlr 1.362 1.3616 -0.04
Taiwan dlr 30.886 30.875 -0.04
Korean won 1159.100 1150.9 -0.71
Baht 32.060 31.98 -0.25
Peso 52.200 52.188 -0.02
Rupiah 14150.000 14090 -0.42
Rupee 69.993 69.87 -0.18
Ringgit 4.134 4.125 -0.22
Yuan 6.729 6.7220 -0.11

Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 111.920 109.56 -2.11
Sing dlr 1.362 1.3627 +0.04
Taiwan dlr 30.886 30.733 -0.50
Korean won 1159.100 1115.70 -3.74
Baht 32.060 32.55 +1.53
Peso 52.200 52.47 +0.52
Rupiah 14150.000 14375 +1.59
Rupee 69.993 69.77 -0.32
Ringgit 4.134 4.1300 -0.10
Yuan 6.729 6.8730 +2.14

(Reporting by Shriya Ramakrishnan in Bengaluru)

First Published: 2019-04-25 03:38:16
Updated 2019-04-25 09:05:39

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