*

Indonesian rupiah falls as much as 0.8%

*

Analysts optimistic on Thai baht

*

Stocks in Malaysia gained 0.7%

By Rajasik Mukherjee

Aug 27 (Reuters) - The Indonesian rupiah and Philippine

peso lost the most in emerging Asia on Tuesday, as geopolitical

tensions in the Middle East dampened global risk appetite,

prompting investors to flee into safe haven assets such as the

U.S. dollar.

The dollar index, which measures the U.S. currency against

six rivals, was last up 0.03% at 100.82 as of 0514 GMT.

Fears of an escalating conflict following Israel and

Hezbollah's major missile exchange over the weekend put a dent

in positive investor sentiment after the Federal Reserve

signalled it was ready to cut rates.

Among emerging Asian currencies, the peso fell as

much as 0.5%, as trade resumed after a holiday break, and was

poised for its worst intraday fall in nearly two weeks. The

rupiah depreciated as much as 0.8%.

The Fed indicated last week that it is ready to cut interest

rates, making investors focus on the upcoming September meeting,

which could influence regional monetary policy.

Asian central banks with the exception of the Philippines

are likely to wait for the Federal Reserve's move to cut rates,

although it may not imply an immediate follow-up, as they

continue to assess their own domestic fundamentals.

Maybank analysts anticipate the Bangko Sentral ng Pilipinas

(BSP) will initiate a cumulative 50 basis point cut this year,

aligning with the Fed's easing, according to a research note.

The analysts added that there are few domestic drivers to

influence this decision.

Other currencies such as the Thai baht, Malaysian

ringgit and the Taiwan dollar fell between 0.1%

and 0.3%.

Analysts, however, struck an optimistic tone with Maybank

believing there are less chances of the baht falling further,

while Barclays said a pick-up in tourism would further bolster

the local currency.

"We are constructive on the THB and see room for gains to

extend in the coming months on the back of receding

political​/​fiscal risk premia, tourism seasonality, firmer gold

prices...," added Barclays analysts.

The Singapore dollar was flat while equities in the

city-state lost 0.3%.

Among other Asian equities, stocks in Manila rose

0.3% while those in Taipei lost 0.5%

HIGHLIGHTS:

** Malaysia charges ex-PM Muhyiddin with sedition over

alleged remarks on royalty, lawyer says

** Japan to monitor impact of expected US rate cut, finance

minister says

** Top US general says risk of broader war eases a bit after

Israel-Hezbollah exchange

Asian currencies and stocks at 0514 GMT

COUNTRY FX RIC FX FX INDE STOCK STOCK

DAILY YTD % X S S YTD

% DAILY %

%

Japan -0.11 -2.50 China EC>

India -0.04 -0.87 Indones -0.36 -0.55 Malaysi -0.14 +5.49 Philipp -0.41 -1.50 S.Korea 11>

Singapo +0.05 +1.21 Taiwan -0.31 -3.70 Thailan -0.12 +0.47