EM ASIA FX-Rupiah, peso lead declines on dollar covering

SINGAPORE, Sept 28 - The Indonesian rupiah and Philippine peso led a broad retreat in emerging Asian currencies on Monday as falling regional stocks prompted investors to cover their short dollar positions.

The yen surged to an eight-month high against the dollar as Japanese officials waved off any plans to step the currency's rise, driving the Nikkei down more than 2 percent and sparking a broad sell-off in risky assets. [ID:nHKG247991]

RUPIAH

The high-yielding rupiah <IDR=> shed as much as 0.9 percent to 9,735 per dollar as weaker local stocks prompt profit-taking on the unit's recent rally.

The rupiah remains the top performing currency in Asia with a gain of 13 percent against the dollar so far this year.

"I suspect the dollar buying is coming from offshore -- investors are taking profits," said Jakarta-based trader, adding that corporate dollar buying for month-end settlements also weigh on the rupiah.

One-month dollar/rupiah non-deliverable forwards <IDR1MNDFOR=> rose to 9,755, implying a 0.4 percent rupiah fall from the spot, reversing from a 0.2 percent implied rupiah rise at Friday's close.

"Dollar/rupiah is biddish," says an NDF trader.

The NDFs traded 12 points below onshore forwards <IDR1M=> compared to 74 points on Friday.

PESO

The peso <PHP=> lost as much as 0.7 percent to 47.63 per dollar, taking its cue from the euro's weakness as investors sold local stocks <.PSI>.

The unit later stabilised near 47.52.

"We had a bit of dollar short-covering earlier as the euro dropped, but (dollar) sellers resurfaced at the 47.60s," said a Manila-based trader, who expected the peso to move within 47.30-47.70 for the day.

Meanwhile, three-month offshore dollar/peso NDFs <PHP3MNDFOR=> rose to 47.83, implying a 0.9 percent peso fall from the spot compared to 1.2 percent at Friday's close. CURRENCIES VS U.S. DOLLAR Change on the day at 0502 GMT Currency Latest bid Previous day Pct Move Japan yen 89.44 89.63 +0.21 Sing dlr 1.4211 1.4160 -0.36 Taiwan dlr 32.456 32.428 -0.09 Korean won 1194.70 1186.10 -0.72 Baht 33.57 33.58 +0.03 Peso 47.52 47.32 -0.43 Rupiah 9730.00 9650.00 -0.82 Rupee 47.97 47.98 +0.02 Ringgit 3.4760 3.4700 -0.17 Yuan 6.8281 6.8282 +0.00 Change so far in 2009 Currency Latest bid End prev year Pct Move Japan yen 89.44 90.60 +1.30 Sing dlr 1.4211 1.4340 +0.91 Taiwan dlr 32.456 32.860 +1.24 Korean won 1194.70 1259.50 +5.42 Baht 33.57 34.80 +3.66 Peso 47.52 47.52 +0.00 Rupiah 9730.00 11000.00 +13.05 Rupee 47.97 48.71 +1.54 Ringgit 3.4760 3.4500 -0.75 Yuan 6.8281 6.8230 -0.07