Emerging Asia FX-Steady before Fed rate verdict

SINGAPORE, Aug 8 (Reuters) - Asian currencies held steady on Tuesday, with the market reluctant to move before a U.S.

Federal Reserve meeting later in the day that is expected to end with a pause in a two-year campaign of raising interest rates.

Asian currencies rose across the board on Monday as last week's weaker-than-expected U.S. jobs data raised bets that the Fed would keep its key rate steady at 5.25 percent.

But now caution prevailed and dealers said trade was likely to be range bound before the Fed rate decision at about 1815 GMT.

The Taiwan dollar and South Korean won were both steady around Monday's closing levels in local trade.

The Thai baht hovered at about 37.70 per dollar, unchanged from late Monday and holding near three-month highs.

A dip in the yen undermined the Singapore dollar, which eased about a quarter of a percent from Monday's 2-{ month highs at 1.5704 to the U.S. dollar.

''There shouldn't be any major outbreaks of ranges,'' said Alvin Cheng, a trader with Bayerische Hypo Und Vereinsbank in Hong Kong. ''The market is going for a Fed pause and is pricing in about 30 percent chance of a hike, so if they do hike rates this will hurt a lot of people.'' Oil prices were in focus after they surged 3 percent on Monday to a barrel as pipeline damage forced oil major BP to shut down an Alaskan oil field that pumps 8 percent of U.S.

domestic output.

Traders said high oil prices could pressure the won, which hit a four-month low last week on worries about Korea's deteriorating trade balance.

The Indonesian rupiah held a narrow range around 9,080 per dollar ahead of a Bank Indonesia interest rate decision later in the day. The central bank is tipped to lower rates by as much as half a percentage point.

''Risks are for a more measured 25 basis points move but recent rupiah resilience should bolster policy comfort for a more aggressive cut in favour for domestic demand,'' analysts at JPMorgan said in a note.

REUTERS MS PC1110