EM ASIA FX-U.S. jobs caution hangs over Asia FX; yuan in worst week since devaluation

* Yuan down 0.5 pct for week; largest loss since Aug *

Rupee leads Asia FX slide on Dec U.S. rate hike views *

Rupiah resists regional losses on foreign demand

(Adds text, updates prices)

By Jongwoo CheonMost emerging Asian currencies took a breather on Friday ahead of key U.S. jobs data and were set to post weekly losses on growing expectations that the Federal Reserve may raise interest rates next month.

China’s yuan dipped and was poised to suffer its largest weekly decline since Beijing surprisingly devalued the currency on Aug. 11. The renminbi slid on worries about a slowing economy and amid uncertainty over when the International Monetary Fund would meet to review whether to include the yuan in its reserve currency basket.

The U.S. dollar stayed around three-month highs against a basket of six major currencies as investors were awaiting October U.S. nonfarm payrolls later in the day with expectations of a December liftoff in interest rates rising.

U.S. employers likely added 180,000 jobs last month, according to the median forecast in a Reuters poll of economists. That compared with slightly sluggish job growth of 142,000 in September.

“A decent nonfarm payrolls print tonight will likely see another leg higher for the USD, and put further pressure on Asian currencies as markets will up the odds of a December rate hike from the Fed,” said Khoon Goh, senior FX strategist for ANZ in Singapore.

“It will need to be a really weak number for the market to substantially lower the pricing for December,” Goh said, adding a print below 140,000 would be such a case.

Fed officials, including Chair Janet Yellen, suggested this week that a December rate increase was still possible, causing more investors to expect a liftoff in the next meeting unless economic data seriously weakens in coming weeks.

SDR UNCERTAINTY

The yuan has lost 0.5 percent against the dollar so far this week. That would be the largest weekly depreciation since the week ended Aug. 14, according to Thomson Reuters data.

China Business News, a respected domestic finance newspaper, said the IMF was pushing back its plan to make a decision to Nov. 30 from Nov. 4, raising doubts about whether the yuan could be smoothly included in the Fund’s Special Drawing Rights basket. Beijing is keen to have the yuan included, alongside the U.S. dollar, euro, British pound and Japanese yen as part of its goal of raising the international profile of the currency.

The IMF said a specific date for the decision had not been set yet.

India’s rupiah has fallen 0.8 percent throughout this week amid worries that a December rise in U.S. borrowing costs may drive foreigners out of emerging markets.

The Singapore dollar has slumped 0.3 percent so far this week, following the yuan’s weakness. The city-state’s currency closely tracks the renminbi as traders and analysts believe it is included in the undisclosed currency basket used by the central bank to manage monetary policy.

The Philippine peso and the Malaysian ringgit have eased 0.2 percent so far this week, while the Thai baht is down 0.1 percent.

Indonesia’s rupiah has bucked the region’s weakness with a 1.0 percent gain against the dollar so far this week. Foreign investors bought the currency as most government bond prices rose.

The South Korean won has gained 0.2 percent on expectations of demand linked to a licence deal between the country’s largest pharmaceutical company Hanmi Pharmaceutical and France’s Sanofi.

Hanmi will receive an upfront payment of 400 million euros ($435.1 million) and is eligible for up to 3.5 billion euros in development, registration and sales milestones, as well as double-digit royalties on net sales.

CURRENCIES VS U.S. DOLLAR
    Change on the day at 0450 GMT
  Currency    Latest bid   Previous day    Pct Move
  Japan yen       121.75         121.76       +0.01
  Sing dlr        1.4066         1.4065       -0.01
  Taiwan dlr      32.410         32.718       +0.95
  Korean won     1137.40        1138.50       +0.10
  Baht             35.56          35.58       +0.06
  Peso             46.89          46.94       +0.10
  Rupiah        13540.00       13560.00       +0.15
  Rupee            65.78          65.75       -0.05
  Ringgit         4.2990         4.2945       -0.10
  Yuan            6.3508         6.3466       -0.07
 
  Change so far in 2015
  Currency    Latest bid  End prev year    Pct Move
  Japan yen       121.75         119.66       -1.72
  Sing dlr        1.4066         1.3260       -5.73
  Taiwan dlr      32.410         31.718       -2.14
  Korean won     1137.40        1099.30       -3.35
  Baht             35.56          32.90       -7.48
  Peso             46.89          44.72       -4.63
  Rupiah        13540.00       12380.00       -8.57
  Rupee            65.78          63.03       -4.18
  Ringgit         4.2990         3.4965      -18.67
  Yuan            6.3508         6.2040       -2.31
  ($1 = 0.9193 euro)

in.reuters.com

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