* Indonesia worries weigh on rupiah before BI rate

decision

* Tech-heavy markets drag MSCI Asia index lower

* Singapore benchmark up 0.9%, India stocks up 0.4%

(Updates for afternoon trade)

By Roushni Nair and Sruthi Narasimha Chari

May 19 (Reuters) - The Indonesian rupiah slid to another

record low on Tuesday, leading declines in Asian currencies as

domestic jitters kept investors wary ahead of Bank Indonesia's

policy decision later this week, where most economists now

expect a rate hike.

The rupiah weakened to 17,730 per U.S. dollar,

extending Monday's slide, as worries over the economic fallout

from the Iran war compounded concerns over Jakarta's spending

plans, central-bank independence and capital-market

transparency.

Continued Bank Indonesia intervention, a steadier domestic

political backdrop and easing Middle East tensions will be

needed to draw foreign inflows, said Krung Thai Bank strategist

Poon Panichpibool.

Wednesday's BI rate decision will test whether policymakers

are ready to shift from intervention to monetary tightening,

with currency stability now the top priority. "BI may need to

hike rates again to curb rupiah weakness and support capital

markets," Panichpibool said.

A slim Reuters poll majority expects a rate hike, the first

since April 2024. Just last month all 31 economists polled had

forecast a hold through the year.

The Indian rupee also slid to a record low of 96.44

per dollar, taking its losses since the Iran war erupted in late

February to about 6% as higher oil prices, rising U.S. yields

and subdued inflows deepened external-sector pressures.

U.S. President Donald Trump said he had paused a planned

attack on Iran to allow negotiations, helping stabilise bond

markets after a two-day selloff and leaving the U.S. dollar

broadly steady.

Still, investors remained wary of export-heavy Asian markets

exposed to higher global yields and weaker risk appetite. The

South Korean won weakened 0.8%, while the Taiwan

dollar slipped 0.3%.

Regional equities also came under pressure, with MSCI's EM

Asia equities gauge falling 1.5%, dragged lower

by a 3% slide in South Korea's KOSPI and a 1% decline in

Taiwan stocks.

Bucking the trend, Singapore's equity benchmark rose

0.9% to a record high of 5,041.06 points, supported by strong

April export data, AI-related electronics demand and the

perceived security of the city-state's bank-heavy, defensive

market.

Singapore Airlines gained 1.9%, while beer-maker

Thai Beverage rose 4.5%.

The Philippine peso slipped 0.06% to 61.65 per

dollar, while Thailand's baht fell 0.3% to 32.6 against

the dollar.

Indian stocks climbed 0.39%, with IT shares

jumping 3.5% on hopes of easing U.S.-Iran tensions.

HIGHLIGHTS:

** Japan's solid Q1 GDP faces reality check on Iran war

** Thai business group maintains 2026 GDP growth forecast

** Malaysia's April CPI rises 1.9% on year

Asia stock indexes and currencies

at 0711 GMT

Japan -0.18 -1.55 -0.44

16.82

China India -0.10 -6.81 0.36 -9.16

Indonesia -0.48 -5.95 -3.45 -26.31

Malaysia +0.03 +2.09 0.07 2.91

Philippines -0.11 -4.67 -0.75 -2.58

S.Korea Singapore -0.19 +0.39 0.90 8.51

Taiwan -0.39 -0.73 -1.75 38.71

Thailand -0.34 -3.68 0.07 20.57