* Thai baht, S.Korea won among top gainers in Asian FX
* Indonesia inflation eases
* Taipei stocks gain 2%

By Archishma Iyer
       Aug 1 (Reuters) - The Malaysian ringgit was on a tear on
Thursday amid buoyant emerging Asian currencies, while share
markets rose, with investors cheering a possible end to the U.S.
Federal Reserve's restrictive policy settings in September. 
    Malaysia's currency advanced as much as 1% to trade
at 4.545 per dollar, its highest in a year. Others such as the
Thailand baht, Taiwan dollar and the South
Korean won traded up to 0.5% higher. The baht was on
course to rise a seventh consecutive day. 
    A period of political stability and the need for global
companies to diversify their supply chains beyond China has put
Malaysia in the limelight. 
    "The ringgit is probably performing catch-up because it was
one of most underperforming currencies recently, and it has been
undervalued for a long time," said Chief FX Strategist Saktiandi
Supaat at Maybank. 
    The Federal Reserve held interest rates steady overnight but
kept the doors open for a cut in September, provided the U.S.
economy "follows its expected path". 
    The MSCI International Emerging Markets Currency Index
 rose as much as 0.3%, hitting its highest since
mid-July and up for a third straight session. 
    Analysts now expect Asian central banks to start easing
policy stances in the near-term as inflation is set to remain
low. The Philippines is likely to kick off the rate-cutting
cycle, followed by South Korea, India and Taiwan. 
    Investors will also await inflation data from South Korea on
Friday to gauge the trajectory of interest rates, while
Indonesia's price pressures eased for July. 
    "We think the central bank in the Philippines will be the
next to loosen policy and have pencilled in an August cut,"
analysts from Capital Economics wrote. 
    "Overall, we expect most central banks to cut rates by
50bps-200bps between now and the end of next year," they said. 
    Among Asian equities, shares in Taipei climbed as
much as 2% to reach a one-week peak, riding the artificial
intelligence boom caused by chip giant Nvidia. Taiwan
Semiconductor Manufacturing, Asia's most valuable
stock, added as much as 3.8%.   
    Other bourses in Bangkok, Manila, Seoul
 and Jakarta rose between 0.5% and 0.8%. 

    HIGHLIGHTS:    
    ** Indonesia's benchmark 10-year bond yield down 5.8 basis
points to 6.865% 
    ** Bank of Korea says it will monitor financial markets more
closely
    ** Chinese factories poised for "cruel summer" as PMI
surveys raise outlook risks     

    
            Asian stocks and currencies at 0438 GMT 
 COUNTRY     FX RIC          FX  FX YTD    INDEX  STOCKS  STOCKS
                          DAILY       %            DAILY   YTD %
                              %                        %  
 Japan                    +0.28   -5.68            -2.52   13.91
 China                    -0.04   -1.82            -0.22   -1.44
 India                    +0.04   -0.57             0.37   15.24
 Indonesia                +0.25   -5.06             0.70    0.47
 Malaysia                 +0.86   +0.81            -0.10   11.63
 Philippine               +0.03   -4.99             0.75    3.39
 s                                                        
 S.Korea                  +0.54   -5.46             0.77    5.15
 Singapore                +0.02   -1.22            -0.83    5.77
 Taiwan                   +0.20   -6.21             1.93   26.20
 Thailand                 +0.23   -3.62             0.53   -6.21
 

 (Reporting by Archishma Iyer in Bengaluru; Editing by Tom
Hogue)