EMERGING MARKETS-Asia FX set for monthly gains, baht steady ahead of rate call

By Rishav Chatterjee

April 30 (Reuters) - The Taiwan dollar and South Korean won led monthly gains among trade-sensitive Asian currencies following U.S. President Donald Trump's 90-day tariff pause, while the Thai baht was steady on Wednesday ahead of a central bank policy meeting.

Taiwan’s export-driven economy, which could face significant risks if Trump follows through with his proposed 32% tariffs, has seen temporary relief since the U.S. President announced a 90-day pause earlier this month.

In response, the Taiwan dollar TWD=TP has added 3.4% so far this month and is on track for its best monthly performance since November last year.
"The export-led Taiwan dollar, South Korean won, and Singapore dollar performed best, thanks to Trump’s 90-day pause on reciprocal tariffs to allow for trade negotiations that included an implicit bias for currency appreciation," said Philip Wee, senior FX strategist at DBS.

The South Korean won KRW=KFTC and Singapore dollar SGD= posted monthly gains of 3.1% and 2.6%, respectively. The latter was set for its strongest month in nearly two-and-a-half years.

Investors cautiously awaited the Bank of Thailand's policy meeting later in the day, where the central bank is expected to deliver a 25 basis-point rate cut for the second consecutive time, according to a Reuters Poll of economists. This could be the central bank's third time cutting rates since October.

The threat of U.S. tariffs of 36% has further undermined business confidence in the Southeast Asian country.

However, the 90-day reprieve helped even the baht THB=TH post gains. Elsewhere, the Philippine peso PHP= added 2.1% in April.

The Vietnamese dong VND= was among laggards, on track for its third consecutive monthly decline, while the Indonesian rupiah IDR= slipped 0.8% in April.

Vietnam is facing one of the steepest U.S. tariff rates at 46% but officials are in talks with Washington to make the most of a 90-day relief.

The rupiah IDR= hit a record low earlier this month and Indonesia's benchmark index .JKSE tumbled as capital fled following the U.S. announcement of reciprocal tariffs. Markets have since regained some ground.

The rupiah has been on a downtrend since March after online speculation that Finance Minister Sri Mulyani Indrawati had resigned. Sri Mulyani has rejected the speculation, saying she has no plans to step down. The rupiah is now likely to catch up with the rebound seen in regional peers, added Wee.

Equity markets in emerging Asia were upbeat on Wednesday, with stocks in Malaysia .KLSE and Singapore .STI adding 0.6% and 0.4%.

Shares in Manila .PSI jumped 1.6% to hit their highest since March 10.

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