EMERGING MARKETS-Rupiah rallies on bumper bond demand, other Asian FX slip

* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E

* Indonesia benchmark bond yield drops

* Malaysia cenbank keeps rates steady

* Increase in Asia's virus cases to dent FX appeal - analyst

By Anushka Trivedi

May 6 (Reuters) - The Indonesian rupiah hit a seven-week high on Thursday as the country's bonds stayed in demand, while all other Asian currencies languished against a dollar buoyed by brightening growth prospects in the world's biggest economy.

The greenback USD= built on momentum stemming from encouraging economic data and higher inflation raising chances of a rate hike, sending Singapore's dollar SGD= , the Thai baht THB=TH and South Korea's won KRW=KFTC lower by 0.1% to 0.4%.

"The U.S. dollar looks like has found a floor and that suggests Asian currencies will largely be on the back foot," said Mitul Kotecha, chief EM Asia & Europe strategist at TD Securities.

"The increase in virus cases across much of the region is also likely to dent support for Asian currencies."

However, Kotecha and several analysts pointed to investor appetite for high-yielding debt markets like Indonesia to keep its currency IDR= supported.

The rupiah jumped 0.8%, while the country's benchmark bond yields ID10YT=RR were down 1.9 basis points at 6.458%. The 10-year yields have declined 43.6 basis points since their March highs.

Even with the pandemic's impact on Southeast Asia's largest economy, "the rupiah is set to receive support from foreign fund inflows, especially if the global hunt for yields persists", said FXTM market analyst Han Tan.

Meanwhile, Kuala Lumpur stocks .KLSE hit a six-month low and the currency MYR=MY eased 0.2% as fresh two-week curbs in the capital added to lockdowns already in place in economically prosperous regions of the country. Negara Malaysia (BNM) left the benchmark interest rate unchanged at a record low of 1.75%, as expected, and said it was seeing improvements in activity, with vaccination expected to drive a rebound. Sachs analysts expect BNM to keep rates on hold for the rest of the year as the economic hit from the latest lockdown measures is expected to be less pronounced than previously.

HIGHLIGHTS

** Singapore shares .STI firm 0.7% after four days of losses

** China stocks .SSEC slip 0.2% on resuming trade after holidays this week

** India reported more than 400,000 coronavirus infections over the last 24 hours, taking the total tally past 21 million

Asia stock indexes and currencies at 0801 GMT

COUNTRY

FX RIC

FX DAILY % FX YTD %

INDEX STOCKS DAILY % STOCKS YTD % Japan

JPY=

-0.15

-5.58 .N225

1.80

6.88 China

CNY=CFXS

-0.02

+0.81 .SSEC

-0.16

-0.92 India

INR=IN

+0.06

-1.09 .NSEI

0.68

5.26 Indonesia

IDR=

+0.80

-1.92 .JKSE

-0.09

-0.15 Malaysia

MYR=

-0.12

-2.43 .KLSE

-0.44

-3.59 Philippines PHP=

+0.03

+0.13 .PSI

-0.27

-12.00 S.Korea

KRW=KFTC

-0.28

-3.52 .KS11

1.00

10.62 Singapore

SGD=

-0.09

-1.15 .STI

0.72

11.70 Taiwan

TWD=TP

-0.11

+1.76 .TWII

0.90

15.35 Thailand

THB=TH

-0.35

-4.01 .SETI

1.44

8.43