* EM FX Asia extend gains as dollar softens
* Thai baht touches a 2-month high
* Dollar down after Trump raps Fed rate hikes
* Indian rupee, S. Korean won sustain gains
(Adds text, updates prices)
By Ambar Warrick
Aug 21 (Reuters) - Nearly all emerging Asian currencies
firmed on Tuesday, with the Thai baht strengthening the most, as
criticism of Federal Reserve rate hikes by U.S. President Donald
Trump dented the dollar.
Trump said he was "not thrilled" with Federal Reserve
Chairman Jerome Powell for raising interest rates, and that the
central bank should help him boost the economy.
The dollar's slip came before anticipated talks between the
United States and China, which many believe might ease trade
"In the interim, there's not likely to be any trade related
negative headlines, and that's why we're seeing the dollar
softening," said Chang Wei Liang, FX strategist at Mizuho Bank.
"It's probably too early to say that the dollar will be
easing dramatically from here but for now it does appear that
the news flow is a bit more supportive of an interim
Risk appetites have been lifted ahead of the Sino-U.S. trade
negotiations, meaning some Asian currencies saw stronger
inflows. The fact that Turkish markets are closed for much of
the week also helped stability, after fears of contagion from
the lira's collapse caused large sell-offs last week.
The Thai baht shot up as much as 0.8 percent
against the dollar.
The Malaysian ringgit and the Chinese yuan
also rose. China and Malaysia signed a memorandum of
understanding on a bilateral currency swap agreement on Monday.
Malaysian Prime Minister Mahathir Mohamad also said he
believed China would sympathise with his country's "internal
fiscal problems" as he seeks to renegotiate, or possibly cancel,
more than $20 billion in Chinese-funded projects.
Philippine markets were closed for a holiday, and the peso
edged lower in very muted trade.
The Thai baht outperformed, touching a two-month high
against the dollar.
Thailand's GDP expanded at a slower pace in the second
quarter, but the state planning agency kept its economic growth
forecast for the year and also raised its exports projection.
Chang of Mizuho called the Q2 growth number "pretty good" as
a moderation was expected.
"Markets are reacting to the sustained growth momentum that
we've seen in Q2, and if that carries on to the second half,
then its very likely that the Bank of Thailand will be confident
enough to begin normalising monetary policy," he added.
The central bank governor said on Monday Thailand cannot
buck the global policy tightening trend but any interest rate
hike will be gradual.
He added that the need to continue "very accommodative"
monetary policy was lessening, but the timing of a rate hike
will be decided by the monetary policy committee.
Thailand's benchmark rate has been kept at 1.50 percent
since April 2015.
The following table shows rates for Asian currencies against
the dollar as at 0514 GMT.
CURRENCIES VS U.S. DOLLAR
Change on the day
Currency Latest bid Previous day Pct Move
Japan yen 110.070 110.06 -0.01
Sing dlr 1.367 1.3687 +0.15
Taiwan dlr 30.702 30.760 +0.19
Korean won 1118.100 1123.1 +0.45
Baht 32.760 33.01 +0.76
Peso 53.307 53.3 -0.01
Rupiah 14575.000 14585 +0.07
Rupee 69.550 69.82 +0.39
Ringgit 4.092 4.099 +0.17
Yuan 6.841 6.8640 +0.34
Change so far in 2018
Currency Latest bid End 2017 Pct Move
Japan yen 110.070 112.67 +2.36
Sing dlr 1.367 1.3373 -2.14
Taiwan dlr 30.702 29.848 -2.78
Korean won 1118.100 1070.50 -4.26
Baht 32.760 32.58 -0.55
Peso 53.307 49.93 -6.34
Rupiah 14575.000 13565 -6.93
Rupee 69.550 63.87 -8.17
Ringgit 4.092 4.0440 -1.17
Yuan 6.841 6.5069 -4.88
(Reporting by Ambar Warrick in Bengaluru)