March 28 (Reuters) - Emerging Asian currencies edged higher against the dollar on Wednesday, as U.S.-China trade tensions weighed on the greenback but investor caution about the trade rift also tempered appetite for risk in the region. The South Korean won climbed over 0.25 percent following the news that the United States and South Korea have reached agreement on a revised trade pact that includes a side deal aimed at deterring competitive currency devaluation by Seoul. The dollar index, which measures the greenback versus a group of six major currencies, was down 0.1 percent at 89.291. "The uncertainty over U.S. protectionism isn't going to fade anytime soon," said Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore in a note. "While investors should enjoy the small win on the tariff front, they'll be best served to prepare for a long drawn out and perhaps more rancorous dialogue between U.S. and China when it comes to intellectual property rights." The Malaysian ringgit, which hit a near 2-year high, led the regional currencies on the day, bolstered by high oil prices and portfolio inflows. Foreigners have bought $25 million in Malaysian equities this month to take their year's tally to $590 million, according to the data compiled by Scotiabank.
The Taiwan dollar and China's yuan were trading flat on the day. Qi Gao, FX strategist at Scotiabank expects the Taiwan dollar to rise further as it has been tracking the moves of China's yuan recently. He said China's stance to tolerate more appreciation in the yuan to help reduce its merchandise trade surplus with the U.S. would support the Taiwan dollar. Some analysts said the fall of 10-year U.S. Treasury yield to a seven-week low of 2.770 percent would prompt carry trades in high yielding Asian currencies. THAI BAHT The Thai baht was down 0.06 percent ahead of the country's central bank monetary policy meeting. A Reuters poll showed the central bank is expected to leave its policy rate unchanged as the economy gains traction. The baht has risen over 4 percent against the dollar this year, after its 10 percent gain in 2017.
"A materially stronger effective exchange rate constitutes tighter overall monetary conditions. And this too offsets the need for the Bank of Thailand to tighten," Vishnu Varathan, head of economics and strategy for Mizuho Bank in Singapore, said in a note. CURRENCIES VS U.S. DOLLAR Change as of 0438 GMT Currency Latest Previous Pct bid day Move Japan yen 105.540 105.33 -0.20 Sing dlr 1.308 1.3096 +0.15 Taiwan dlr 29.140 29.135 -0.02 Korean won 1066.00 1070.3 +0.40 0 Baht 31.200 31.18 -0.06 Peso 52.230 52.32 +0.17 Rupiah 13742.0 13740 -0.01 00 Rupee 64.948 64.98 +0.04
Ringgit 3.857 3.8755 +0.49 Yuan 6.278 6.2775 -0.01 Change so far in 2018 Currency Latest End 2017 Pct bid Move Japan yen 105.540 112.67 +6.76 Sing dlr 1.308 1.3373 +2.27 Taiwan dlr 29.140 29.848 +2.43 Korean won 1066.00 1070.50 +0.42 0 Baht 31.200 32.58 +4.42 Peso 52.230 49.93 -4.40 Rupiah 13742.0 13565 -1.29 00 Rupee 64.948 63.87 -1.66 Ringgit 3.857 4.0440 +4.86
Yuan 6.278 6.5069 +3.64
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