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EMERGING MARKETS-Asia's FX steady as traders hold off bets ahead of U.S. inflation report

    * Malaysian markets among top gainers after long weekend
    * Investors torn between higher returns and the Fed's stance - analyst
    * Singapore finance minister says will change tax system as needed

    June 8 (Reuters) - Asia's emerging market currencies largely held steady on
Tuesday, as traders adopted a cautious approach ahead of U.S. inflation data
this week for clues on the Federal Reserve's tapering timeline. 
    Stock markets, on the other hand, were a mixed bag with Indonesian shares
 falling 0.8% on concerns over a spike in COVID-19 cases in some parts of
the country, while Malaysian and Philippine shares rose around
0.5%. 
    Malaysian markets were closed on Monday for a public holiday.
    Investors are keeping a close watch on U.S. inflation data due on Thursday,
following on from last week's payrolls report which tempered expectations of any
near-term moves by the Fed to tighten policy.
    "There is some respite for EM assets as taper fears get pushed back," Eugene
Leow, a rates strategist at DBS, said in a note. 
    "We reckon investors are still torn between chasing higher returns while
keeping an eye on when the Fed's stance would change. An uncomfortable carry
environment is likely ongoing as complacency on low USD rates seep in."
    The ringgit advanced 0.2%, while the Philippine peso and South
Korean won weakened.  
    The rupiah, favoured by foreign investors looking at Indonesia's
high-yielding debt, held steady even as stocks dropped. 
    Bank Indonesia data showed foreign exchange reserves fell by $2.4 billion in
May amid capital outflows.
    Indonesian authorities have drafted in more doctors and nurses to two areas
on the islands of Java and Madura after hospitals there approached full
capacity, raising worries of a potentially broader spike in cases that has hit
other Asian countries in recent weeks.
    Singapore stocks trimmed earlier losses that were largely in real
estate firms and banks. 
    The city-state, a low-tax jurisdiction, will change its tax system as
needed, its finance minister said after a group of seven advanced economies
agreed to a mininum global corporate rate.
    Singapore is home to a number a global multinational firms' regional
headquarters, including several tech giants. 
            
    HIGHLIGHTS:
    ** Indonesian 3-year benchmark yields fell 5.4 basis points to 4.85%​​ ​​
    ** SATS Ltd and Singapore Airlines Ltd gained the most;
Comfortdelgro Corp Ltd fell 1.2%
  Asia stock indexes and currencies at   0634 GMT
 COUNTRY      FX RIC      FX       FX     INDEX    STOCKS   STOCKS
                          DAILY %  YTD %           DAILY %  YTD %
 Japan                    -0.19    -5.67           -0.19    5.54
 China                    +0.09    +2.15           -0.67    2.95
 India                    -0.05    +0.31           -0.14    12.50
 Indonesia                +0.00    -1.54           -0.81    0.69
 Malaysia                 +0.15    -2.43           0.48     -2.53
 Philippines              -0.08    +0.67           0.68     -4.62
 S.Korea                  -0.12    -2.51           -0.13    13.03
 Singapore                -0.02    -0.18           -0.10    11.57
 Taiwan                   +0.06    +2.84           -0.05    15.91
 Thailand                 -0.03    -3.94           -0.09    11.16
 

 (Reporting by Nikhil Kurian Nainan in Bengaluru, Editing by Shri Navaratnam and
Rashmi Aich)
  
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