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EM ASIA FX-Philippine peso at 3-week high, GDP data backs case for rate hike

* Philippine Q2 GDP growth fastest in five quarters

* Rupiah edges down on importers' dollar demand

* Indonesia may revoke contracts of 17 coal miners

(Adds text, updates prices)

By Jongwoo Cheon

SINGAPORE, Aug 28 (Reuters) - The Philippine peso rose to

its strongest in more than three weeks on Thursday as better

than expected economic growth data boosted chances for a further

rate hike, while capital inflows fuelled further gains in most

emerging Asian currencies.

Indonesia's rupiah went against the trend, due to a

combination of importers need for foreign currency and concerns

over how exports will be affected if coal mining contracts are

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revoked due to unpaid royalties.

The Philippine economy grew 6.4 percent in the second

quarter from a year earlier, the fastest pace in more than a

year, led by strong manufacturing and exports. That compared

with a Reuters poll forecast for 6.2 percent growth.

The data powered the peso to 43.55 per dollar,

its strongest since Aug. 5, even though it later gave up all the

gains amid month-end dollar demand from local companies.

"It puts PHP on a solid footing compared to other economies

in the region," said Jonathan Cavenagh, senior FX strategist

with Westpac in Singapore, who expects the central bank to raise

interest rates.

"BSP might continue to look to accumulate USD's but this is

probably the only factor that can stand in way of further PHP

strength," Cavenagh said, referring to the Bangko Sentral ng

Pilipinas.

The peso's one-month non-deliverable forwards (NDFs)

is likely to test 43.50 per dollar, he added.

The NDF barely changed at 43.65 as of 0430 GMT.

"Stronger-than-expected data will fuel stronger talks of

Moody's upgrading the Philippines very soon," said a senior

Philippine bank trader in Manila who saw spot peso possibly

strengthening to 43.20.

Moody's Investors Service currently has a "positive" outlook

for the Philippines' rating and its team just finished a visit

to the country.

RUPIAH

The rupiah edged down on dollar demand from

Indonesian importers for month-end payments.

On Wednesday, the director general for coal and minerals

said the country may revoke the contracts of 17 coal miners that

owe royalties to the government, including PT Arutmin Indonesia,

a unit of PT Bumi Resources Tbk.

"Coal contributes roughly 14 percent of total Indonesian

exports, so even if one-third of exports gets affected, it will

have quite a bit of impact on whether Indonesia can eke out

trade surplus or linger in the red," said Wellian Wiranto,

economist at OCBC Bank in Singapore.

"In the context of how Indonesia is trying to narrow its

current account deficit ahead of potential a Fed Fund rate hike

talks, this is obviously not helpful."

TAIWAN DOLLAR

The Taiwan dollar rose as much as 0.3 percent to

29.883 per U.S. dollar, its strongest since Aug. 13, on buying

by foreign financial institutions.

Foreign investors on Wednesday reported a ninth straight net

buying in local stocks.

Domestic exporters also bought the island's currency for

month-end settlements.

The central bank was spotted buying the U.S. dollar to curb

the island unit's appreciation, but the intervention looked

relatively small, traders said.

The central bank let the Taiwan dollar end the local market

stronger than 30.000 per dollar on Wednesday, for the first time

since July 11, traders said.

That came as the South Korean won hit a

seven-week high.

The central bank tends to closely look at the won as some of

the island's major companies, such as Taiwan Semiconductor

Manufacturing Co Ltd, compete with South Korea's

rivals in overseas markets.

BAHT

The baht advanced as much as 0.4 percent to 31.79

per dollar, its strongest since Aug. 18, as offshore funds

continued to buy Thai stocks and bonds.

Month-end dollar demand from importers also faded, traders

said.

Local banks, however, took profit from the currency's gains,

limiting its upside.

CURRENCIES VS U.S. DOLLAR

Change on the day at 0420 GMT

Currency Latest bid Previous day Pct Move

Japan yen 103.71 103.88 +0.16

Sing dlr 1.2465 1.2478 +0.10

Taiwan dlr 29.883 29.985 +0.34

Korean won 1013.30 1014.40 +0.11

Baht 31.89 31.92 +0.11

Peso 43.66 43.66 +0.00

Rupiah 11690.00 11680.00 -0.09

Rupee 60.41 60.45 +0.07

Ringgit 3.1460 3.1465 +0.02

Yuan 6.1428 6.1432 +0.01

Change so far in 2014

Currency Latest bid End prev year Pct Move

Japan yen 103.71 105.28 +1.51

Sing dlr 1.2465 1.2632 +1.34

Taiwan dlr 29.883 29.950 +0.22

Korean won 1013.30 1055.40 +4.15

Baht 31.89 32.86 +3.06

Peso 43.66 44.40 +1.68

Rupiah 11690.00 12160.00 +4.02

Rupee 60.41 61.80 +2.30

Ringgit 3.1460 3.2755 +4.12

Yuan 6.1428 6.0539 -1.45

(Additional reporting by Rosemarie Francisco in MANILA, Lin

Miao-jung in TAIPEI and Satawasin Staporncharnchai in BANGKOK;

Editing by Simon Cameron-Moore)