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Oil prices plunge about 30%

* Malaysian ringgit drops to mark worst day in two-weeks

* Yuan expected to outperform the basket in 2020 - HSBC analyst (Adds text, updates prices)

By Anushka Trivedi

March 9 (Reuters) - Asian currencies weakened on Monday as investors sold off risky assets after a plunge in oil prices exacerbated concerns over economic fallout stemming from the coronavirus epidemic.

Saudi Arabia's decision to slash average selling prices and ramp up crude production after Russia backed away from making output cuts sent shockwaves through the markets and is likely to weigh on regional currencies, since the majority of them are net oil importers. O/R

Meanwhile, the number of coronavirus cases globally surged past 107,000 as the outbreak spread to more countries. Italy took drastic measures and sealed off large parts of the prosperous north of the country, including financial capital Milan. investors sought safer bets and pushed the Japanese yen JPY= up 3% against the dollar to a three-year high and the euro EUR= to a two-year peak. FRX/

U.S. 30-year treasury yields US30YT=RR sank below 1% and 10-year yields US10YT=RR under 0.5%, eroding the dollar's chief attraction as the markets upped their bets for further rate cuts by the Federal Reserve to mitigate the economic damage.

The Fed's move is expected to spill over to Asia, with Morgan Stanley (NYSE:MS) analysts expecting that "the majority of emerging market central banks will also cut rates further, taking global monetary policy rates to a new all-time low."

Malaysia, and oil importing nation Indonesia, saw their currencies lose nearly 1% against the dollar, while their respective stock markets also hit multi-year lows. .SO

The rupiah IDR= was on track to slide for a third straight session and Indonesia's 10-year government bond yield ID10YT=RR rose slightly. Malaysian ringgit MYR= dropped 0.9% and was on its way to mark a worst session in two-weeks. The country's new prime minister is due to announce his new cabinet later on Monday, a week after he was appointed amid a political tussle. South Korean won KRW=KFTC weakened as much as 1.3% to 1,207.20 against the dollar, prompting its finance ministry to issue a verbal warning against disorderly currency market movement. the world's third-biggest oil importer, saw its currency INR=IN decline 0.3%, while the Singapore dollar SGD= gave up about 0.5%.

The Chinese yuan CNY=CFXS pared early gains to trade 0.1% lower after reporting a larger than expected plunge in exports over the weekend. analysts at HSBC see the yuan benefiting from a dip in oil prices as nearly a quarter of its imports are commodity-related.

China's monetary policy will be closely watched, which has so far lagged the Fed's, and resulted in a record yield differential that is likely to support foreign inflows to its bond market, HSBC added.

"We believe the yuan will outperform the basket this year."

CURRENCIES VS U.S. DOLLAR AS AT 0518 GMT Currency

Latest bid Previous day Pct

Move Japan yen

102.560

105.3

+2.67 Sing dlr

1.385

1.3781

-0.46 Taiwan dlr

30.077

30.040

-0.12 Korean won

1205.300

1192.3

-1.08 Baht

31.530

31.41

-0.38 Peso

50.625

50.54

-0.17 Rupiah

14350.000 14220

-0.91 Rupee

73.975

73.73

-0.34 Ringgit

4.208

-0.90 Yuan

6.943

6.9342

-0.12

Change so far in 2020

Currency

Latest bid End 2019

Move Japan yen

102.560

108.61

+5.90 Sing dlr

1.385

1.3444

-2.90 Taiwan dlr

30.077

30.106

+0.10 Korean won

1205.300

1156.40

-4.06 Baht

31.530

29.91

-5.14 Peso

50.625

50.65

+0.05 Rupiah

14350.000 13880

-3.28 Rupee

73.975

71.38

-3.51 Ringgit

4.208

4.0890

-2.83 Yuan

6.943

6.9632

+0.29

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The safe-haven yen soared, the euro jumped after U.S. treasury yields dropped and export sensitive currencies fell to multi-year lows on Monday as coronavirus fears routed global markets.

The yen JPY= jumped more than 3% to a day high of 101.69 per dollar, its highest in three years and the sharpest daily jump since mid-2016.

The euro EUR= rose more than 1.4% to an almost two-year peak of $1.1452. The Australian AUD=D3 and New Zealand NZD=D3 dollars both lost more than 2%, with the Aussie hitting a fresh 11-year low.

Against the yen, the Aussie AUDJPY= and Kiwi NZDJPY= lost more than 5%.

"It is totally wild," said Shafali Sachdev, head of FX Asia at BNP Paribas (PA:BNPP) Wealth Management in Singapore. "Stops are being triggered at every level," she said.

"This is not a train I want to be getting in front of, and how long it continues and where it goes from here is going to depend on how the situation evolves," she added, saying further stockmarket falls could drive even bigger moves in funding currencies.

The number of people infected with the coronavirus has topped 107,000 across the world as the outbreak reached more countries and caused more economic disruption. panic was exacerbated by a collapse in oil prices, which dropped more than 20% after the world's top exporter, Saudi Arabia, vowed to cut prices and raise its production significantly. O/R

The yield on 10-year U.S. Treasuries US10YT=RR went under 0.5% for the first time, amid a rush for the safety of bonds.

That undermines the dollar by all but sinking one of the most popular carry trades globally - borrowing at negative rates in euro or yen to buy U.S. assets.

The yen's jump drew concern in Japan, with a senior finance official telling reporters that authorities were closely watching trade. the oil price fall made for withering drops in oil exporters' currencies.

The Mexican peso MXN= fell as far as 6% against the dollar. The Canadian dollar CAD=D3 fell more than 2% to 1.3690 per dollar, its lowest since 2017.

The Norwegian krone NOK=D3 shed 3% to hit a  record trough and the Russian rouble RUB= plunged by 5% to its lowest in nearly four years.

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