EMERGING MARKETS-Thai baht firms more than 1% on easing of quarantine rules

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    * Most other Asian currencies decline
    * Thai baht scales over two-week high
    * South Korea's won hits over 1-year low
    * S.Korea base rate unchanged at 0.75%

    By Sameer Manekar
    Oct 12 (Businesshala) - While most Asian currencies weakened on
Tuesday, Thailand's baht gained more than 1% to stand at its
strongest in over two-weeks  after the government eased
quarantine rules for visitors from low-risk countries in a bid
to revive its key tourism sector.
    South Korea's won slipped 0.5% to hit its lowest
in more than a year, and equities lost nearly 2%,
falling to their lowest this year after the central bank kept
interest rates unchanged.
    Trying to keep the economic recovery on track while
containing a surge in private sector debt, the Bank of Korea
held the benchmark interest rate at 0.75%, as expected by a
Businesshala poll, after its first rate hike in nearly three years in
August.
    Analysts at Capital Economics expect BoK to make two further
25 basis points hikes by the third-quarter next year, with
another in early 2023.
    Writing  in a note, they said recent data out of South Korea
points to a decent recovery in the third-quarter, and solid
progress on vaccination raises prospects for lifting of
containment measures and a rebound in consumer spending over the
quarter ahead.
    In Thailand, stocks advanced up to 0.8% and the baht
 firmed as much as 1.2% to hit its highest level since
late September.
    Thailand's Prime Minister Prayuth Chan-ocha on Monday said
the tourism-reliant country will end coronavirus quarantine
rules for vaccinated visitors from 10 low-risk countries,
including the United States, Singapore, and China from November.

    "The reaction on the recent Thai baht rally is largely due
to the news of reopening, but I don't think it will extend the
rally that much as fundamentals for the Thai economy remain
weak," Poon Panichpibool, a market strategist at Krung Thai
Bank.
    "It will be up to the direction of the U.S. dollar which
will be weaker once the Fed begins tapering, with another factor
being the foreign fund flows which the reopening theme might
help," he said, adding that he expects the baht to end the year
at 33-33.25 per dollar.
    Meanwhile, the U.S. dollar index, which measures the
greenback against a basket of peers, was trading at 94.351 as of
0230 GMT, hovering near the one-year high of 94.504 touched at
the end of last month.
    Investors are now focusing on U.S. inflation and retail
sales numbers later this week, and are expecting the Federal
Reserve to begin tightening policy next month.
    Elsewhere in Asia, the Taiwan dollar slipped 0.3%
to its lowest since late-April, while equities slumped
more than 1%.
    Among stocks, Indonesia's benchmark was up 0.7%,
Philippine shares extended gains after clocking a sharp
3% rise in the previous session, while shares in Singapore
 were down more than half a percent.
        
    HIGHLIGHTS:
    ** Indonesian 10-year benchmark yields rise 3.1 basis points
to 6.394%
    ** India's retail inflation likely fell to a five-month low
in September - Businesshala poll
    ** U.S. two-year Treasury yields leaps to a more than
18-month high
    
  Asia stock indexes and                            
 currencies at   0343 GMT                      
 COUNTRY  FX RIC        FX    FX  INDE  STOCK  STOCK
                     DAILY   YTD     X      S  S YTD
                         %     %        DAILY      %
                                            %  
 Japan               +0.04  -8.8  <.N2  -0.93  2.87
                               4  25>          
 China                       7  EC>          
 India                0.00  -3.0  <.NS   0.00  28.35
                               4  EI>          
 Indones             -0.08  -1.2  <.JK   0.54   8.62
 ia                            4  SE>          
 Malaysi             -0.02  -3.5  <.KL   0.44  -3.04
 a                             7  SE>          
 Philipp             +0.12  -5.4  <.PS   0.01  -0.21
 ines                          4  I>           
 S.Korea                     6  11>          
 Singapo             -0.06  -2.5  <.ST  -0.64   8.78
 re                            7  I>           
 Taiwan              -0.36  +1.2  <.TW  -1.13  11.68
                               0  II>          
 Thailan             +1.26  -10.  <.SE   0.62  13.40
 d                            41  TI>          
 
    

    
 (Reporting by Sameer Manekar in Bengaluru; Editing by Simon
Cameron-Moore)
  
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