* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
* Graphic: Foreign flows into Asian stocks https://tmsnrt.rs/3f2vwbA
* Vietnam stocks hit lowest since May 6
* Peso hits more than 3-1/2 year high
* Thailand markets shut for holiday
By Shashwat Awasthi and Pranav A K
July 27 (Reuters) - Philippines shares sank more than 2% on Monday, deepening a sell-off this month, as coronavirus cases mounted and the country's central bank gave a grim economic outlook for 2020 ahead of a state of the nation address from President Rodrigo Duterte.
The Taiwanese dollar TWD=TP and the South Korean won KRW=KFTC led gains across Asia against a globally weak U.S. dollar, with Indonesia's rupiah IDR= firming for the fifth straight session.
In a quarterly inflation report, however, the Bangko Sentral NG Pilipinas affirmed its earlier view that its economy would continue to contract for the next two quarters, highlighting the pain ahead as new virus cases continue to run at more than 2,000 daily.
The risk of a second wave of infections also plagued Vietnam stocks .VNI , which plunged as much as 5.8% after the country reported new locally transmitted coronavirus cases in more than three months. Scriven, chairman of Ho Chi Minh-based asset manager Dragon Capital, said the discovery of the new virus cluster had been a "shock to the system" for investors.
In Manila, the central bank again emphasised that keeping policy accommodative would mitigate risks to the economy, but stocks .PSI still slid for a fifth consecutive day to their lowest since June 1.
The fall leaves them down around 25% for the year against a dip of just 2% for MSCI's broad index of Asia shares outside Japan. Mae V. Lomboy, a fund manager at First Metro Asset Management said Philippine stocks faced "downward bias as the market awaits direction and concrete support from the government" in the state of the nation address.
"The officials' balanced action between virus containment and economic activity resumption are crucial for investors at this point," she said.
Riding the global wave against the dollar, however, the peso PHP= hit its highest since November 2016.
Investors have been driven out of the traditional security of the dollar by worries about renewed lockdowns in the United States, bickering over a new fiscal support package and escalating tensions with China. FRX/
** Singapore's 10-year benchmark yield is up 1 basis points at 0.822%
Asia stock indexes and currencies at 0706 GMT
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