*

Thai baht gains briefly after BOT holds rates

*

Singapore and Taiwan shares ease

*

Currencies range-bound across emerging Asia

(Updates for afternoon trade)

By Rishav Chatterjee

Oct 8 (Reuters) - Thai stocks moved in a tight range on

Wednesday, while the baht gained modestly against the U.S.

dollar after the central bank unexpectedly left its key interest

rate steady, while a record-setting rally in emerging Asia

equities came to a halt.

Thailand's benchmark stock index fell 0.1% after the

decision but then regained ground and was last trading up 0.2%,

while the baht appreciated to 32.400 per U.S. dollar

but settled slightly higher around 32.430.

The Bank of Thailand left its key interest rate unchanged,

counter to market expectations for a quarter-point rate cut,

citing the need to balance support for a fragile economic

recovery with limited policy space.

"The main reason they refrained from cutting rates today

appears to be concern about preserving policy space," Capital

Economics senior Asia economist Gareth Leather said.

"Despite today's hold, we think further rate cuts are likely

as the central bank tries to boost growth and ward off the

threat of deflation. Overall, we are expecting two more 25-bp

cuts this cycle, bringing the policy rate to 1.0% by end-2026."

In the broader market, the MSCI gauge of equities in

emerging Asia fell 1.2% from a more than

four-year peak scaled on Tuesday. A subset of ASEAN equities

, dominated by Singapore, snapped a five-session

rally.

Singapore's index slipped 0.6% from a record high,

snapping a seven-day rally, while Taiwan shares fell off

a lifetime high scaled on Tuesday.

Asian equities soared to multi-year highs recently on

enthusiasm for artificial intelligence and robust momentum in

chip stocks, only to stall abruptly, as a prolonged U.S.

government shutdown and a dearth of economic data stoked risk

aversion.

"Cautious sentiment in U.S. and European equity markets has

weighed on emerging Asian stocks," Krung Thai Bank market

strategist Poon Panichpibool said.

"The recent pullback in AI and semiconductor shares in those

regions likely contributed to the underperformance in Taiwan

and, to some extent, Singapore."

Vietnam's stocks reached a record high as market

participants welcomed FTSE Russell's move to upgrade the country

to emerging markets status.

The Philippine stocks bucked the broader trend to

rise 0.3%, while shares in Malaysia and Indonesia

dropped 0.3% and 0.2%.

Currency trading in emerging Asia was tepid, with the

Singapore dollar losing 0.2%, as the U.S. dollar index

touched a more than two-month high against a basket of

major currencies.

The Indonesian rupiah, Taiwan dollar and

Malaysian ringgit inched lower. The Philippine peso

was trading 0.1% in the green.

HIGHLIGHTS:

** Thailand unveils new stimulus, says aiming for growth of

more than 2.2% this year

** Indonesia 10-year benchmark ticks lower by 6.5 basis

points

Asia stock indexes

and currencies at

0743 GMT

COUNTRY FX RIC FX DAILY FX YTD % INDEX STOCKS STOCKS

% DAILY YTD %

%

Japan -0.33 +3.13 -0.45 21.44

China India -0.01 -3.57 -0.13 6.05

Indonesi -0.12 -2.81 -0.22 15.13

a

Malaysia -0.07 +6.00 -0.32 -1.07

Philippi +0.11 +0.14 0.25 -6.59

nes

S.Korea Singapor -0.18 +5.42 -0.41 17.59

e

Taiwan -0.05 +7.36 -0.54 17.49

Thailand +0.14 +5.78 0.29 -6.51