Asian currencies rose after China’s third quarter economic growth beat analysts’ estimates, helping to ease concern that an unexpected interest-rate increase will slow the world’s second-largest economy. The Singapore and Taiwan dollars rallied the most in a week after China signaled its preference for a stronger yuan by setting the daily fixing higher against the greenback, which slumped in New York trading. U.S. Treasury Secretary Timothy F. Geithner will meet his counterparts from the Group of 20 nations in Gyeongju, South Korea, over the next few days with currency policies likely to be on the agenda. “China’s data shows that the economy is still holding up quite well and they can continue to appreciate the currency,” said Ho Woei Chen, a regional economist at United Overseas Bank Ltd. in Singapore. “This will lead Asian currencies higher. China also set a stronger yuan fixing today and there is talk that Geithner will pressure China to appreciate its currency at the G-20 talks.” Singapore’s dollar strengthened 0.4 percent to S$1.3015 as of 11:42 a.m. local time, according to data compiled by Bloomberg. Taiwan’s dollar gained 0.4 percent to NT$30.796 and the Thai baht rose 0.2 percent to 29.85. Malaysia’s ringgit climbed 0.1 percent to 3.1150 and the Philippine peso edged up 0.1 percent to 43.310. G-20, Currencies Currencies and trade flows will be at the center of talks as G-20 finance ministers try to resolve differences over exchange-rate policies, a U.S. Treasury Department official said yesterday, speaking on condition of anonymity. Some emerging- market nations are keeping their currencies undervalued, the official added. China’s gross domestic product increased 9.6 percent in the third quarter from a year earlier, the statistics bureau said today, more than the 9.5 percent median forecast in a Bloomberg survey. Consumer prices rose 3.6 percent in September, the fastest pace in 23 months, the government also reported today. The central bank on Oct. 19 lifted its benchmark one-year lending and deposit rates by a quarter of a percentage point to 5.56 percent and 2.5 percent respectively. It was the first increase since 2007. The People’s Bank of China today set the yuan reference rate 0.1 percent higher at 6.6695 per dollar. Twelve-month non- deliverable forwards climbed 0.18 percent to 6.4285, reflecting bets the currency will strengthen 3.4 percent from the spot rate of 6.6482. The currency has gained 2.7 percent since a two-year- old peg to the dollar was scrapped on June 19. Higher Yields The ringgit rebounded from a seven-week low on heightened speculation the Federal Reserve will unveil more monetary stimulus next month after a regional survey released yesterday showed the U.S. economy expanded in September at a “modest pace.” “The market is consolidating but I’m still expecting more ringgit appreciation going into next year,” said Zulkiflee Nidzam, head of foreign-exchange trading at Asian Finance Bank Bhd. in Kuala Lumpur. “The dollar can’t sustain its rally because the Fed’s program will support demand for higher yields.” Elsewhere, South Korea’s won gained 0.1 percent to 1,126.01 per dollar and Indonesia’s rupiah was little changed at 8,935. The Indian rupee climbed 0.1 percent to 44.2950. To contact the reporter on this story: Patricia Lui at plui4@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.

Source