* South Korean won falls 0.9%
* Indonesia's stocks jump 1.1%
* BSP expected to cut rates in August - analysts
* Indonesia and South Korea rate decisions expected next

By Poonam Behura
       May 17 (Reuters) - Asian currencies trimmed gains on
Friday after a rally sparked by softer U.S. inflation data, as
market uncertainty persisted after hawkish comments from Federal
Reserve officials suggested interest rates might need to stay
    A post-U.S. CPI rally in Asia fizzled out as the greenback
rebounded following a tight labour market data and caution from
central bankers about inflation. The U.S. dollar index,
which had hit multi-month lows in prior session, advanced 0.2%. 
    "While USD may adjust lower in light of recent softness in
US data, there may also be a limit to how much lower the USD can
go as the USD still retains a carry advantage, broadly," OCBC
currency strategist Christopher Wong said.
    The MSCI index for emerging markets currencies
 edged down 0.22% after touching a two-month high
on Thursday.
    Asian EM currencies have lost much ground against the U.S.
dollar in recent years because of the Fed's hawkish policies,
weaker economic data from key Asian economies, and increased
global demand for the dollar as a safe haven.
    The South Korean won fell 0.9%, leading losses in
the region. 
    Taiwan's dollar and Indonesia's rupiah
slipped 0.4% each.
    In the Philippines, the peso fell 0.3%, a day after
the central bank stood pat on rates and hinted that it will cut
rates in August. 
    "Dovish meeting gives us more confidence that the BSP will
start to loosen policy soon. We are sticking with our view that
the central bank will cut interest rates by 25bps in August,
with further loosening later in the year," analysts at Capital
Economics said in a client note. 
    OCBC's Wong said the window of breather for Asian currencies
due to the dollar's pullback may close they may take cues from
softer China data, in particular consumer spending and very weak
    China's industrial output rose 6.7% annually in April,
beating expectations, data on Friday showed. Markets are also
waiting for details on China's housing as officials are expected
to discuss property aid, including a proposal to buy unsold
homes to ease oversupply.
    The yuan was trading 0.1% lower. 
    Asian equities broadly eased due to paring back of
expectations for earlier U.S. rate cuts, with markets now fully
pricing in one cut in November, with 68% chance of a cut in
    Stocks in South Korea fell 1%, but stayed on course
to snap a three-week gaining streak. Those in Singapore
and Taiwan also slipped 0.3% each. 
    Indonesia's benchmark index jumped 1.1%, hitting a
seven-week high. The index was on course for its biggest weekly
gain this year. 
    Next week's key focus will be the central bank interest rate
decisions in Indonesia and South Korea. Barclays expects policy
rates for both banks to remain unchanged.
    First quarter GDP figures from Thailand and Singapore due
next week are likely to be weaker, according to Barclays.

    ** Singapore's April exports fall 9.3% y/y, shipments to US
down sharply
    ** India central bank likely selling dollars to cap rupee
depreciation, traders say
    ** Malaysia's economy grows annual 4.2% in Q1, helped by
export rebound

                       DAILY %  YTD %          DAILY   YTD %
 Japan                   -0.27  -9.46  <.N22  -0.35   16.52
 China                   -0.09  -1.78  <.SSE   -0.10    4.85
 India                   +0.02  -0.33  <.NSE   -0.05    3.04
 Indonesi                -0.38  -3.66  <.JKS    1.12    0.76
 a                                     E>             
 Malaysia                -0.04  -1.99  <.KLS    0.37   11.17
 Philippi                -0.33  -3.99  <.PSI   -0.07    2.69
 nes                                   >              
 S.Korea                 -0.91  -5.11  <.KS1   -0.98    2.66
 Singapor                -0.11  -2.09  <.STI   -0.26    1.73
 e                                     >              
 Taiwan                  -0.36  -4.66  <.TWI   -0.27   18.49
 Thailand                -0.25  -5.80  <.SET    0.25   -2.45

 (Reporting by Poonam Behura in Bengaluru. Editing by Gerry