EM ASIA FX-Asia FX rise as US debt deal hopes lift risky assets


* Emerging Asian currencies climb broadly

* Risky assets rise on hopes for deal on U.S. debt ceiling

* Ringgit, rupee, and baht all gain about 0.3 pct

(Updates prices, adds text)

By Masayuki Kitano

SINGAPORE, Oct 11 (Reuters) - Asian currencies rose on

Friday as risk sentiment improved on growing hopes for a deal in

Washington to end a fiscal standoff and possibly avoid a U.S.


Most emerging Asian currencies pushed higher, with the

Malaysian ringgit, Thai baht and Indian rupee

all rising roughly 0.3 percent.

Republicans offered a plan to President Barack Obama on

Thursday that would extend the government's borrowing authority

for several weeks, staving off a default that could come as soon

as Oct. 17.

No deal emerged from a 90-minute meeting at the White House,

but talks continued into the night in an effort to re-open the

government and extend the government's borrowing authority

beyond the mid-October deadline.

Asian currencies are likely to stay firm in the near term if

the U.S. debt ceiling is actually extended, said Satoshi

Okagawa, senior global markets analyst for Sumitomo Mitsui

Banking Corporation in Singapore.

This is partly because a short-term deal, rather than a

longer-term solution, could add to uncertainty over just how

soon the U.S. Federal Reserve will start tapering its

bond-buying stimulus, he said.

"The Fed won't be able to step toward tapering unless there

is a clear-cut resolution," Okagawa said, referring to the U.S.

debt ceiling.

Market sentiment toward emerging Asian currencies has

generally improved recently, after the U.S. Federal Reserve

surprised markets in September by keeping its bond-buying

stimulus programme unchanged.

The shock decision created uncertainty over how soon the Fed

would start to scale back its bond-buying, and such doubts have

been reinforced this month as the U.S. government's partial

shutdown stirred worries about the potential impact on U.S.


"The expectation for tapering is now delayed," said a trader

for a Malaysian bank in Kuala Lumpur.

"But I sense people will look for opportunity to (go) long

the dollar on dips," he added.

Market players remain cautious about the longer-term outlook

for emerging Asian currencies, given the prospects for the Fed

to start tapering its monetary stimulus eventually, even if the

exact timing is unclear.

A recent Reuters poll showed that most Asian currencies were

expected to depreciate in the next 12 months.


The Singapore dollar lagged behind its regional

peers and eased slightly. A near-term focal point for the

Singapore dollar is a monetary policy decision by Singapore's

central bank on Monday.

Singapore's central bank is expected to keep monetary policy

unchanged next week as it stays on guard against inflation while

an expected contraction in third-quarter GDP is likely to be

seen as a temporary blip.

The Monetary Authority of Singapore is seen likely to

continue to let the local dollar appreciate at its current

trajectory, according to a Reuters survey of



* Taiwan dollar's previous close is from Oct. 9. Taiwan's

financial markets were closed on Thursday for a public holiday.

Change on the day at 0458 GMT

Currency Latest bid Previous day Pct Move

Japan yen 98.39 98.16 -0.23

Sing dlr 1.2488 1.2481 -0.06

Taiwan dlr 29.398 29.548 +0.51

Korean won 1071.15 1073.60 +0.23

Baht 31.32 31.40 +0.26

Peso 43.11 43.15 +0.09

Rupiah 11460.00 11480.00 +0.17

Rupee 61.23 61.39 +0.27

Ringgit 3.1820 3.1915 +0.30

Yuan 6.1171 6.1158 -0.02

Change so far in 2013

Currency Latest bid End prev year Pct Move

Japan yen 98.39 86.79 -11.79

Sing dlr 1.2488 1.2219 -2.15

Taiwan dlr 29.398 29.136 -0.89

Korean won 1071.15 1070.60 -0.05

Baht 31.32 30.61 -2.27

Peso 43.11 41.05 -4.78

Rupiah 11460.00 9630.00 -15.97

Rupee 61.23 54.99 -10.18

Ringgit 3.1820 3.0580 -3.90

Yuan 6.1171 6.2303 +1.85


(Editing by Kim Coghill)

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