Malaysia, Singapore shares down close to 1% * Taiwan dollar gains 0.4%, hits 1-week high * Thai cenbank says financial system vulnerable to COVID-19 spike * Thai cabinet approves $22.3 bln for COVID-19 response By Nikhil Nainan May 19 (Reuters) - Malaysian stocks and Indonesia"s rupiah led losses on Wednesday, as investors trimmed exposure to Asia"s risk-sensitive currencies and equities markets after a soft session on Wall Street and worries around the resurgence of COVID-19 cases in the region. The rupiah, favoured by foreign investors seeking to tap Indonesia"s high-yielding debt, fell 0.3% with most of Asia"s other emerging currencies flat to slightly lower. Taiwan"s dollar stood out with a 0.4% gain. Malaysian and Singapore stocks fell close to 1%. "Sentiment is likely to remain cautious as a viral resurgence in parts of Asia remains on top of traders" minds," Margaret Yang, a DailyFX strategist, said. The broad weakness in the region comes ahead of minutes from the Federal Reserve"s most recent meeting later on Wednesday that is expected to confirm that policymakers think a rate hike is still some time away. Singapore, Taiwan and Malaysia have all imposed coronavirus measures to combat new outbreaks, amid worries of more contagious variants, at a time when the West is easing restrictions. Vaccination drives in Asia have also been slow. "Asian central banks have generally been held back by the virus situation," Duncan Tan, a rates strategist at DBS, said in a client note. "We don"t think Asia can be expected to deviate from the global policy normalisation trend for an extended period of time," he added, referring to other central banks in advanced and emerging economies that are turning less dovish as they watch over rising commodity prices. Inflation remains a worry as recent data shows consumer prices rising in the United States, though the Fed has thus far stuck to the narrative that it would be transient and monetary policy should stay accommodative. Minutes from the Thai central bank"s latest meeting showed policymakers viewed Thailand"s financial system as more vulnerable from the latest coronavirus outbreak, posing significant risks to the economy. The Thai cabinet approved a further 700 billion baht ($22.26 billion) of borrowing on Tuesday to support the government"s COVID-19 response. Meanwhile, the Taiwan dollar hit a one-week high against the greenback. Officials on Tuesday said they expected limited impact on Taiwan"s economy and its key semiconductor industry from the COVID-19 outbreak. Markets in South Korea and Hong Kong were closed for holidays. HIGHLIGHTS: ** Indonesian 10-year benchmark yields rise 7 basis points to 6.475% ** Taiwan calls for fair access to vaccines ** Singapore seeks COVID-19 vaccination for all adults by August Asia stock indexes and currencies at 0330 GMT COUNTRY FX RIC FX FX INDEX STOCKS STOCKS DAILY % YTD % DAILY % YTD % Japan -0.06 -5.23 -1.40 2.05 China -0.05 +1.56 -0.46 1.14 India 0.00 +0.03 0.00 8.06 Indonesia -0.28 -1.89 -0.44 -2.85 Malaysia 0.00 -2.55 -0.87 -3.06 Philippines +0.14 +0.48 -0.36 -12.85 S.Korea - -3.92 - 10.43 Singapore -0.07 -0.71 -0.76 9.67 Taiwan +0.39 +2.29 -0.19 9.38 Thailand +0.06 -4.65 0.04 8.14 ($1 = 31.4400 baht) (Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Jacqueline Wong) Our Standards: The Thomson Reuters Trust Principles.