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SINGAPORE: Emerging Asian currencies rose as the Chinese yuan extended gains and diplomatic efforts helped contain tensions in Ukraine, with the Indonesian rupiah near a four-month high, while investors speculated whether the European Central Bank would ease policy.
The rupiah gained as much as 1.0 percent to 11,465 per dollar, its strongest since Nov. 11, on demand from hedge funds and foreign banks.
The South Korea won advanced as offshore funds chased it and on exporters' demand for settlements.
Traders dumped dollar holdings, which they had built up on expectations of dollar bids linked to South Korea's payment to Iran for crude oil imports, as they have not yet seen large demand for the greenback.
The Philippine peso gained as market talk of bond inflows caused investors to cover short positions, traders said.
The yuan appreciated for a third consecutive session on heavy dollar selling from corporate amid signs the central bank was staying on the sidelines.
The renminbi's strength lifted the Singapore dollar , which investors often use for proxy trades to bet that the yuan will appreciate or depreciate.
Malaysia's ringgit gained as much as 0.4 percent to 3.2575 per dollar, its strongest since Jan. 13, on short-covering.
Emerging Asian currencies often track the yuan due to the importance of China to the region. The yuan's recent weakness had put pressure on regional currencies.
Investors were awaiting the ECB's policy decision later in the day. The ECB is expected to refrain from cutting interest rates this time and opt for a less drastic step of loosening lending conditions to fight off the danger of debilitating low inflation.
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