SINGAPORE: The Singapore dollar and the South Korean won led a slide among emerging Asian currencies as investors avoided risky assets on sustained worries about the euro zone's debt problems, with Spain due to hold a bond auction later in the day.

The Indian rupee briefly found support from a surprise 50-basis-point rate cut by the central bank, but the impact did not last long.

Most regional units started the day slightly firmer, but a weaker euro and softer regional stocks prompted profit-taking.

Spain is set to see its borrowing costs leap when it sells short-term bonds, after jitters over its deficit and banking sector pushed longer term risk premiums above 6 percent and drove the cost of insuring its debt to a record high.

"The current levels of Asian currencies do not necessarily reflect a 'worst-case' scenario for Spanish debt. If the situation deteriorates, it could drive depreciation," said Sacha Tihanyi, senior currency strategist at Scotia Capital in Hong Kong.

He added that the rupee, the South Korean won and Malaysian ringgit were seen as more vulnerable as they were exposed to negative capital flows.

The Indian currency turned lower after hitting a session high, with the central bank warning that there was limited scope for further rate cuts.

"The comment that room for further rate cuts is limited may limit INR gains," said Westpac foreign exchange strategist Jonathan Cavenagh in Singapore. "Yesterday we had an upside surprise on inflation data and positive revisions to previous months, which will be very much at the forefront of RBI thinking in terms of determining how far they should cut rates."

SINGAPORE DOLLAR

US dollar/Singapore dollar rose on short-covering and with the city state suffering an unexpected fall in March exports.

Singapore dollar/ringgit also slid 0.5 percent to 2.4481 on profit taking.

But the cross pair is expected to rise, probably to 2.4800 as it broke the previous high near 2.4535.

WON

Dollar/won gained on demand linked to dividend payments by domestic companies to foreign shareholders.

The pair ended local trade at 1,140.5, higher than the top of the daily Ichimoku cloud near 1,139.0, as dividend-related dollar bids prompted interbank players to cover short positions.

SK Telecom was scheduled to pay 277.3 billion won ($243.54 million) in dividends to foreign shareholders on Tuesday, according to Reuters calculations.

TAIWAN DOLLAR

Taiwanese exporters sold US dollar/Taiwan dollar in a subdued trading.

But local importers also bought the pair below the level and investors remained worried about Spain, limiting its downside, dealers said.