Regional currencies appeared to be pulled lower early yesterday by the fierce undertow of a weaker yen - but Merrill Lynch said the linkages between the Japanese currency and its Asian cousins might have changed. 'The mainstream view is that Asian currencies will suffer from the weakness of the yen,' strategist Quah Hong Chye said. 'We suspect the dynamic interactions with yen have changed . . . a weak yen and slow Japanese economy are no longer harmful to Southeast Asia and Korea.' Merrill said the belief that yen weakness spelled Asian-unit weakness was founded on currency moves over the past three years, with last year's devaluations traced to the yen's retreat from its 1995 high of 78 to the US dollar. 'Many Asian economies are now running current account surpluses, after being forced to a lower rate of investment by recent crises. Therefore they no longer need capital inflows from Japanese foreign direct investment or cheap US dollar investments,' Merrill said. In post-crisis Asia, domestic currencies should be buttressed by inflows of foreign capital. 'We cannot fathom why the ringgit, baht and rupiah must be under pressure simply because the yen is,' it said.