Asian currencies eke out gains on muted dollar

Reuters

Asian currencies eke out gains on muted dollar

9 أكتوبر 2024 الساعة 08:8 صباحاً بتوقيت GMT

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Thailand baht gains most among Asian FX

RBI holds interest rates at 6.50%

Shanghai stocks reverse Tuesday's gains

By Sneha Kumar and Archishma Iyer

Oct 9 (Reuters) -Most emerging Asian currencies registered minor gains against a broadly muted dollar on Wednesday, as investors sought data to assess the Federal Reserve's rate cut path.

Thailand's baht THB=TH appreciated as much as 0.8% before pulling back gains to 0.3%. It is the second-best performing currency in the region this year, after the Malaysian ringgit, with a near 2% jump.

The currency of Southeast Asia's second-largest economy has been buoyed recently by U.S. interest rate cut bets, stabilising politics and economic growth.

"For the baht, there could be some USD-selling interest from market players especially exporters as they have been waiting for the baht to weaken a bit," said Poon Panichpibool, a markets strategist at Krung Thai Bank.

At 0744 GMT, the dollar index inched higher to 102.64.

The Indonesian rupiah IDR= was up 0.2%, while the Malaysian ringgit MYR= rose marginally.

The Philippines peso PHP= was a notable outlier, falling about 0.3% to its lowest since mid-August.

"Until the sentiment-driven market aligns with the Fed’s underlying outlook for lower inflation and interest rates, currencies are likely to lack direction from markets over-reacting to better- or worse-than-expected data," analysts from DBS wrote.

Global investors are now awaiting a key inflation print from the U.S., as well as minutes from the Fed's latest monetary policy meeting later in the day, for a better sense of where interest rates could be headed.

Falling U.S. rates boost the attractiveness of riskier emerging market assets, particularly in Southeast Asia.

In India, stocks .NSEI rose as much as 0.9% after the Reserve Bank of India changed its policy stance to neutral and opened the door to cuts as early as December, while the rupee INR=IN remained flat.

The central bank maintained its key interest rate steady at 6.50% as expected.

Elsewhere, the Bank of Korea is expected to move with a 25-basis points cut later this week.

Among other Asian equities, Taipei .TWII rose as much as 1.2% to its highest level in nearly two weeks, before ending 0.2% higher.

Shares in Singapore .STI rose 0.5%, while Bangkok .SETI and Kuala Lumpur .KLSE inched up 0.2% each.

Meanwhile, equities in Shanghai .SSEC snapped a 10-day winning streak, tumbling 6.6% and erasing all gains from the previous session.

The index had risen as much as 10.1% on Tuesday on anticipation of more strong stimulus measures from Beijing which failed to materialise.

Markets in South Korea were closed for a public holiday.

HIGHLIGHTS:

** Thailand approves $400 mln investment by Continental AG to expand tyre facility

** India, S. Korea bonds to join FTSE Russell government indexes in 2025

** China's finance ministry to detail fiscal policy on Saturday

Asian currencies and stocks at 0744 GMT
COUNTRY	FX RIC	FX DAILY %	FX YTD %	INDEX	STOCKS DAILY %	STOCKS YTD %
Japan	JPY=	-0.20	-5.00	.N225	0.89	17.37
China	CNY=CFXS	+0.02	+0.49	.SSEC	-6.62	9.54
India	INR=IN	+0.01	-0.89	.NSEI	0.53	15.72
Indonesia	IDR=	+0.16	-1.41	.JKSE	-0.48	3.41
Malaysia	MYR=	0.05	+7.17	.KLSE	0.19	12.66
Philippines	PHP=	-0.30	-2.83	.PSI	-1.50	15.11
S.Korea	KRW=KFTC	-	-4.31	.KS11	-	-2.29
Singapore	SGD=	-0.03	+1.15	.STI	0.47	10.87
Taiwan	TWD=TP	0.00	-4.61	.TWII	0.21	26.37
Thailand	THB=TH	+0.25	+2.03	.SETI	0.17	2.79