* Rupiah short interest lowest since May
* Bets rupee will fall rise on cbank uncertainty
* Korean won bear bets fall to over one-year low
By Rushil Dutta
Dec 13 (Reuters) - Bearish bets on most Asian currencies fell over the past two weeks, a Reuters poll showed on Thursday, as the U.S. Federal Reserve is widely expected to hold rates next year after a near certain hike next week.
Wagers on the yuan weakening declined by half as trade talks between Washington and Beijing gained traction.
Short interests in the yuan were at the lowest level since March 2017, the poll of 11 respondents showed, as the local unit gallops towards its best monthly performance since January, firming over 1 percent so far this month.
The yuan is of late underpinned by a perceived improvement in Sino-U.S. trade relations, which have been strained much of this year and often exacerbated by verbal volleys exchanged between Beijing and U.S. President Donald Trump.
However, breaking from his usual stonewalling stance, Trump told earlier this week that talks were taking place with Beijing over phone and that he would not raise tariffs on Chinese imports until he was sure about a deal.
He even offered to intervene in the Justice Department's case against the chief financial officer of telecoms giant Huawei Technologies, who was granted bail by a Canadian court earlier this week.
Meanwhile, a weakening in the dollar outlook also gave Asian currencies a lift.
Although the dollar has gained over 5 percent so far this year on the back of Fed rate hikes, the recent softening of U.S. Treasury yields and lukewarm economic data have led some to forecast that the dollar may have hit a ceiling.
While the Fed is widely expected to raise rates next week, investors see barely one more hike next year. However, some banks such as JP Morgan expect as many as four hikes in 2019.
Bearish bets on the Singapore dollar SGD= receded marginally, while those on the Indonesian rupiah IDR= fell to their lowest since the beginning of May.
Short interests in the Korean won KRW=KFTC fell to a more than one-year low, while those in its low-yielding peer the Taiwanese dollar TWD=TP were at their lowest since May-end.
Meanwhile, bearish bets piled up on the Indian rupee INR=IN after a sharp decline two weeks ago, as investors digested the sudden resignation of the central bank governor, Urjit Patel, on Monday. Shaktikanta Das, an ex-finance ministry official, was swiftly placed in the top post.
Besides, data on Wednesday showed retail inflation rate dropped to a 17-month low in November, increasing chances the new RBI chief would hold rates at his first policy meeting.
The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar TWD=TP , Indian rupee INR=D2 , Philippine peso PHP=PDSP , Malaysian ringgit and the Thai baht.
The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3.
A score of plus 3 indicates the market is significantly long U.S. dollars. The figures included positions held through non-deliverable forwards (NDFs).
The survey findings ASIAPOSN are provided below (positions in U.S. dollar versus each currency): DDMM CNY KRW SGD ID IDR TWD INR MYR PHP THB 13/12 0.52 0.44 0.54 0.57 0.34 0.72 0.78 0.66 0.15 29/11 1.06 0.74 0.57 0.71 0.73 0.55 0.96 0.70 0.50 15/11 1.28 0.85 0.87 1.37 0.73 1.19 0.97 0.93 0.48 1/11 1.37 0.99 0.75 1.69 0.82 1.37 0.89 1.07 0.53 18/10 1.14 0.82 0.49 1.68 0.60 1.68 0.75 1.36 0.07 4/10 1.11 0.56 0.70 1.65 0.65 1.74 0.74 1.53 0.10 20/9 1.12 0.79 0.95 1.57 0.69 1.72 0.82 1.44 0.33 6/9
0.92 0.64 0.86 1.37 0.68 1.72 0.90 1.13 0.24 23/8 0.93 0.71 0.84 1.27 0.91 1.19 0.88 0.86 0.47 9/8
1.52 0.94 0.80 1.21 0.99 1
0.86 1.02 0.66