* Indonesia central bank holds interest rate steady
* Singapore dollar climbs to a more than two-year high
* Thai baht hits its strongest level since late May 2013
By Shriya Ramakrishnan
Dec 17 (Reuters) - Asian currencies gained ground on
Thursday with the Thai baht surging to a seven-year peak as
investors bet that a rebuke from Washington on Thailand's
currency practices may prompt the central bank not to suppress
an appreciation in baht.
Regional currencies strengthened as progress towards a U.S.
stimulus package pushed the dollar to 2-1/2-year lows against
major rivals. The Malaysian ringgit, Singapore dollar
and Indian rupee added between 0.2% and 0.4%.
The baht strengthened 0.4% and breached the
psychological 30 per dollar mark that Thai exporters had urged
the central bank to preserve last week to keep them competitive.
The Bank of Thailand had then intervened to slow the volatility
in the currency.
In a long-overdue report, the U.S. Treasury added India,
Thailand and Taiwan to a watch list of countries it suspects may
be deliberately devaluing their currencies against the dollar.
Thailand said its addition to the list would have no big
impact, while Taiwan said its currency policies were aimed at
stability and that it hopes to cut its trade surplus with the
United States to address U.S. concerns.
Asian currencies have gained strongly against a globally
weaker dollar since May as signs of an economic rebound in the
region, low valuations and high yields in some markets drew a
flood of foreign capital.
"In the near-term the central bank might refrain from
heavily supporting the baht due to the report," said Poon
Panichpibool, a market strategist at Krung Thai Bank.
"By letting the baht dip below the 30 per dollar level
today, it is a signal that the central bank will let it move
more freely in line with its Asian peers."
The Indonesian rupiah, which backs one of Asia's most
popular bond markets for foreign investors, held steady at
14,085 per dollar as the central bank kept its key interest rate
unchanged at a record low of 3.75%, after five rounds of cuts
Yields on the Indonesian government's ten-year bonds
were down 8.9 basis points after the announcement,
while stocks in Jakarta dipped 0.2%.
The Philippine central bank also left its benchmark interest
rate at a record low of 2%. The peso was up marginally.
In equity markets, Singapore shares shed 0.4%, after
data showed the city-state's non-oil domestic exports
unexpectedly fell 4.9% in November from a year earlier.
** Thailand's 10-year government bond yields are down 4
basis points at 1.24%
** Top losers on the Jakarta stock index include
Indo-Rama Synthetics Tbk PT down 7% at 2790 rupiah;
Multifiling Mitra Indonesia Tbk PT down 6.88% at 745
** Top losers on FTSE Bursa Malaysia Kl Index
include Genting Bhd down 2.07% at 4.74 ringgit; Public
Bank Bhd down 1.83% at 4.42 ringgit; CIMB Group
Holdings Bhd down 1.78% at 21.48 ringgit
Asia stock indexes and
currencies at 0759 GMT
COUNTRY FX RIC FX FX INDEX STOCK STOCKS
DAILY YTD % S YTD %
Japan +0.29 +5.26 0.18 13.32
India +0.19 -2.80 0.40 12.90
Indonesi +0.04 -1.46 -0.24 -3.11
Malaysia +0.42 +1.41 -0.51 5.29
Philippi +0.05 +5.42 -0.02 -6.62
Singapor +0.30 +1.47 -0.35 -11.17
Taiwan -0.02 +5.71 -0.32 18.85
Thailand +0.44 +0.13 0.48 -5.74
(Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Arun