Emerging Asia FX-Korean won hurt by India blasts, BOJ view

SINGAPORE, July 12 (Reuters) The South Korean won bore the brunt of early selling of Asian currencies on Wednesday ahead of what could be Japan's first rate rise in six years and after a series of bomb blasts in India.

The won slipped about 0.35 percent to 950 per dollar and the Taiwan dollar slipped about a quarter of a percent to levels around 32.517.

Other Asian currencies were marginally lower, despite some hesitation among traders to buy the U.S. dollar ahead of data that could show the U.S. trade deficit in May swelled to its widest in four months.

''There is some buying in dollar/won and dollar/Taiwan,'' said Alvin Cheng, a trader with Bayerische Hypo Und Vereinsbank in Hong Kong.

''I don't think it's solely due to the Mumbai blast. It looks more like a continuation of yesterday's move,'' Cheng said.

A currency strategist said the seven blasts on the suburban railway network in Mumbai, India's financial hub, was a domestic issue and should not have any regional impact.

''But everything is quite bid. Maybe there is a bit of risk reduction going on,'' he said. The Japanese yen was steady around 114.25/35 per dollar heading into the two-day Bank of Japan policy meeting on Thursday and Friday.

The BOJ is widely expected to lift overnight rates from zero, having reduced excess cash with Japanese banks for months.

Traders and analysts said hedge funds and mutual funds had been seen buying the yen and selling won this week, in anticipation of a yen rally.

The yen-won cross was quoted at 8.29 won per yen on Wednesday, having moved up from lows of 8.17 late last week.

CURRENCIES VS U.S. DOLLAR Change on the day at 0221 GMT Currency Latest bid Previous day Pct Move Japan yen 114.39 114.26 -0.11 Sing dlr 1.5792 1.5770 -0.14 Taiwan dlr 32.512 32.450 -0.19 Korean won 948.80 946.60 -0.23 Baht 37.84 37.79 -0.13 Peso 52.26 52.23 -0.06 Rupiah 9035.00 9040.00 +0.06 Rupee 46.17 46.18 +0.03 Ringgit 3.6510 3.6470 -0.11 Yuan 7.9908 7.9919 +0.01 Change so far in 2006 Currency Latest bid End prev year Pct Move Japan yen 114.39 117.96 +3.12 Sing dlr 1.5792 1.6625 +5.27 Taiwan dlr 32.512 32.850 +1.04 Korean won 948.80 1011.60 +6.62 Baht 37.84 41.11 +8.64 Peso 52.26 53.09 +1.59 Rupiah 9035.00 9835.00 +8.85 Rupee 46.17 45.04 -2.44 Ringgit 3.6510 3.7790 +3.51 Yuan 7.9908 8.0702 +0.99 REUTERS SY RK0940