Feb 17 (Reuters) - Foreign investors pulled out of Asian bonds for a third straight month in January, deterred by expectations of higher U.S. tariffs under President Donald Trump and a slower pace of Federal Reserve rate cuts, diminishing the appeal of regional assets.

Non-native investors divested regional bonds worth a net $266 million, a sharp reduction from net outflows of about $2.3 billion in the prior month, according to data from regulatory authorities and bond market associations in South Korea, India, Indonesia, Thailand and Malaysia.

"Outflows were driven by concerns around the new U.S. administration’s trade policies and markets paring back Fed rate cut expectations," said Khoon Goh, head of Asia research at ANZ.

This month, the U.S. imposed an additional 10% tariff on all Chinese imports, prompting Beijing to retaliate with tariffs on U.S. goods, including oil, coal, gas, cars, and farm equipment.

Meanwhile, President Trump instructed his economic team last week to develop plans for reciprocal tariffs on any country that imposes taxes on U.S. imports.

"Imposition of reciprocal tariffs on Asian economies will negatively impact growth," ANZ's Goh said.

Foreigners withdrew a net $1.14 billion from South Korean bonds, registering a second monthly outflow in a row.

Indian and Thai bonds also suffered a net $399 million and $84 million worth of selling, respectively.

Meanwhile, Indonesian bonds attracted purchases worth a net$1.1 billion, the first monthly inflow in three months, driven by a surprise rate cut by Bank Indonesia (BI) to prop up growth.

Malaysian bonds also saw a net $258 million worth of inflows following three monthly outflows in a row.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Janane Venkatraman)

((patturaja.murugaboopathy@thomsonreuters.com;))