Emerging FX-Asia steadies, sentiment still bullish

SINGAPORE, Dec 4 (Reuters) Most Asian currencies were steady against the dollar on Monday, as optimism from solid regional economic data was offset by persistent concerns that central banks would intervene to curb currency strength.

The Thai baht, the best-performing Asian currency so far this year, was a noteable exception.

It fell more than a third of a percent in early deals on Monday after the Bank of Thailand reiterated it would take action against speculation on the baht.

But Irene Cheung, a currency analyst at ABN AMRO, expects Asian currencies to climb higher in the coming weeks against the dollar, buoyed by stronger-than-expected economic growth in Thailand and solid trade surpluses in South Korea and Indonesia.

''I think the near-term outlook for the Asian market is still very good. Eventhough there is a slowdown in the U.S., we believe that the regional momentum from China, India, and consumption growth are going to be supporting factors for next year,'' she said.

Sustained capital inflows and trade surpluses have underpinned Asian currencies in recent weeks, but dealers remain cautious about possible central bank intervention.

The dollar fell to a fresh 20-month low against the euro on Monday, carrying over its weakness from Friday, when weak U.S.

factory data reinforced expectations the Federal Reserve would cut rates next year.

The latest Reuters poll on positioning in Asian currencies suggests investors stepped up long positions in the Thai baht and remained bullish on the South Korean won and Singapore dollar.

The Thai baht, which has gained 14.5 percent so far this year, fell as low as 35.93 per dollar from Friday's eight-year high of 35.70 amid jitters of possible intervention, despite tronger-than-expected economic data.

The state planning agency said on Monday that Thailand's economy expanded a seasonally adjusted 1.5 percent in the third quarter, above market forecasts and its fastest pace in a year.

Bank of Thailand Governor Tarisa Watanagase was due to hold a news conference at 0700 GMT on Monday after the central bank said on Friday it would announce measures to curb speculation in the baht.

The Bank of Thailand has been intervening both verbally and through dollar buying in recent weeks, traders said.

The South Korean was bid as high as 926 per dollar at one point, but still off a nine-year high of 925 set on Nov. 27..

The Taiwan dollar firmed as high as 32.25 per U.S. dollar, matching Friday's peak, which was the highest in about 4-{ months, while the Singapore dollar hovered between 1.5402 and 1.5430, below a nine-year high set last week.

REUTERS LL RN1024