* MSCI’s gauge of Asian emerging market equities down 0.2% * Trump, Xi agree to further trade talks * U.S. jobs, non-farm payrolls data due Friday By Roshan Thomas June 6 (Reuters) – Asian currencies were steady on Friday but on track for weekly gains, while regional stock markets edged lower after U.S. President Donald Trump and Chinese leader Xi Jinping agreed to further trade talks in a telephone call. MSCI’s index of emerging market currencies was flat after touching an all-time high on Thursday. For the week, the index is up 0.5%. Regional currencies traded in a tight range, with the Thai baht inching up 0.1%. The baht and Singapore dollar were set for weekly gains of 0.4% and 0.6%, respectively, with the Malaysian ringgit up nearly 0.6% for the week. During their much-anticipated hour-long telephone call, Xi urged Trump to ease trade tension that has unsettled the global economy and cautioned against any threatening actions on Taiwan, a summary from the Chinese government showed. But Trump said on social media that the talks, focused primarily on trade, led to “a very positive conclusion”. “The talks look positive, and coupled with Federal Reserve rate cut expectations due to weak U.S. data, might lead to further USD softening,” said Saktiandi Supaat, Head of FX research at Maybank. The dollar index was little changed, after hitting a six-week low on Thursday, and was headed for a weekly loss of 0.7%. Markets are now bracing for the U.S. jobs and non-farm payrolls report due later in the day, with concerns that a downside surprise could stoke stagflation fears and boost pressure on the Federal Reserve to quickly ease policy. “We hold on to selling USD on rally alongside fading U.S. exceptionalism and a weaker NFP print would reinforce the narrative that U.S. exceptionalism is indeed fading,” Maybank analysts said in a note. Trump’s erratic tariff policies and a deteriorating U.S. fiscal outlook have sparked a flight from the dollar. As a result, analysts expect most emerging market currencies to hold the gains they have made this year or extend them in the next six months. Regional stocks were broadly lower, with MSCI’s gauge of Asian emerging market equities down 0.2%. Equities in Malaysia and Thailand fell 0.1% and 0.8%, respectively, while those in India were down 0.2%. The rupee was a shade lower at 85.865 per dollar after the Reserve Bank of India cut its key repo rate by a larger-than-expected 50 basis points. Markets in Indonesia, the Philippines and South Korea were closed for a public holiday. HIGHLIGHTS: ** Trump ban on entry of international Harvard students blocked by US judge ** Philippines gross foreign reserves at $105.5 billion at end-May Asia stock indexes and currencies at 0455 GMT COUNTRY FX RIC FX DAILY FX YTD INDEX STOCK STOCK % % S S YTD DAILY % % Japan -0.20 +9.30 <.N225 0.29 -5.6 > China > India -0.09 -0.30 <.NSEI 0.18 4.86 > Indones +0.00 -1.11 <.JKSE 0.63 0.47 ia > Malaysi +0.00 +5.70 <.KLSE -0.10 -7.66 a > Philipp -0.04 +4.34 -0.03 -2.33 ines S.Korea > Singapo +0.04 +6.27 0.16 3.60 re Taiwan +0.06 +9.62 <.TWII -0.16 -6.06 > Thailan +0.11 +5.26 <.SETI -0.78 -19.1 d > 8 (Reporting by Roshan Thomas in Bengaluru; Editing by Clarence Fernandez)
