EMERGING MARKETS-Philippine peso leads Asia FX lower; Fed decision in focus

* Thailand sees no impact from global banking woes * Singapore benchmark hits near two-week high * Markets in Indonesia closed for public holiday By Jaskiran Singh March 22 (Reuters) - Philippine peso fell most among subdued Asian currencies on Wednesday, as investors awaited the U.S. Federal Reserve's interest rate decision. While most Asian currencies were either flat or saw minimal movements, the peso was on track to snap a five-day rally, down 0.6%. "In terms of fundamentals, the country (Philippines) has twin deficits, a fiscal deficit and a current account deficit... this tends to weigh on the currency," said Shaun Lim, FX Strategist at Maybank. The Bangko Sentral ng Pilipinas (BSP) is also expected to hike rates by 25 basis points (bps) on Thursday. While bigger economies Malaysia and Indonesia paused their respective rate-hike cycle, Lim said the same might not be a situation for BSP due to the twin deficits. "(I) am not so certain on a pause, given that the hikes are a way for them (BSP) to defend the strength of peso." The Thai baht inched higher after depreciating in the earlier part of the session. Thailand is expected to hold elections in mid-May, with the polls shaping up to be a battle between a pro-military conservative grouping against the largest opposition party. The poll-bound country forecasted the economy to grow 3% to 4% this year and expected to see up to 27 million foreign tourists this year. "There could be some volatility (on baht) for the time on account of political risks, but on longer term, our view is still positive, because they are one of the economies with greater linkages to China, both in terms of trade and travel," said Lim. Elsewhere, the Singapore dollar and Malaysian ringgit were flat. The South Korean won gained 0.3%. Globally, traders are focussed on whether the Fed will keep to its hawkish path to fight soaring inflation or pause interest rate hikes with markets pricing in about roughly 86% chance of a 25 bp hike, showed the CME FedWatch tool. Asian equities mirrored overnight Wall Street gains, as fears over liquidity in the banking sector receded. Shares in Singapore hit their highest in nearly two weeks, after gaining up to 1.6%. Stocks in Manila also hit their highest since March 13, while Thai benchmark rose 0.5%. HIGHLIGHTS: ** UPDATE 3-Indonesia passes jobs decree into law, easing investment uncertainty ** ANALYSIS-Some new faces but old divisions to haunt Thailand's May election ** China weighs cut of about 2.5% in 2023 crude steel output -sources Asia stock indexes and currencies at 0618 GMT COUNTRY FX FX FX INDEX STOCKS STOCKS RIC DAILY YTD % DAILY YTD % % % Japan +0.05 -1.00 1.93 5.26 China India +0.00 +0.08 0.14 -5.38 Indonesia 0.00 +1.47 1.20 -2.32 Malaysia +0.04 -1.52 0.06 -5.89 Philippines -0.59 +1.92 0.64 0.09 S.Korea Singapore -0.06 +0.25 1.44 -0.97 Taiwan +0.16 +0.64 1.59 11.48 Thailand +0.09 +0.58 0.46 -5.05 (Reporting by Jaskiran Singh in Bengaluru; Editing by Rashmi Aich)