Emerging Markets: Most Asian FX lifted on potential Fed rate hike end; equities rise

Applied Energetics

28/11/2023 07:35

* 
      South Korean won leads charge among Asia FX 
    

        * 
      MSCI International EM currency index not far from 18-month high 
    

        * 
      Thai baht hits highest since Aug
    

  
 (Updated at 0655 GMT)
    By Archishma Iyer
       Nov 28 (Reuters) - Most emerging Asian currencies were bolstered by a
weak U.S. dollar on Tuesday, with the South Korean won leading the charge after
softer U.S. economic data signalled a potential pause in Federal Reserve rate
hikes and spurred a positive trend in equities. 
    A slip in new U.S. home sales overnight pushed the dollar to a three
month-low, cementing bets that the Fed's aggressive campaign of raising rates
likely peaked.  FRX/  
    Investors will look to the U.S. Personal Consumption Expenditure (PCE) data
out later this week for further cues on the rate trajectory, with a 25% chance
of the Fed beginning to cut rates as early as March next year. 
    At 0655 GMT, the dollar index  =USD , which measures its strength against
six major peers, was at 103.2, steady at its last close. 
    "Players are still banking on Friday’s anticipated slower PCE deflator
inflation as a convincing sign that the Fed is done tightening," analysts at DBS
wrote in a note. 
    Back in Asia, the South Korean won  KRW=KFTC  led the gains for the day,
advancing as much as 1%, with the Taiwan dollar  TWD=TP  in tow, ending about
0.4% higher. 
        Thailand's baht  THB=TH  also traded 0.5% higher, hitting its highest
level in three months to trade at 34.870 to the dollar and poised for its second
straight monthly gain.   
  
    The Thai central bank governor, however, flagged that economic growth in the
third quarter was disappointing, even as domestic consumption held up well.
 urn:newsml:reuters.com:*:nL4N3CS2NB 
    The Singapore dollar  SGD= , Malaysian ringgit  MYR=  and the Indonesian
rupiah  IDR=  traded up to 0.4% higher. 
    Both the Malaysian and the Philippines currencies  PHP=  are set to snap a
three-month losing streak in November, while the Indonesian rupiah is likely to
log its biggest monthly gain since January. 
    The MSCI International Emerging Market Currency Index  .MIEM00000CUS  inched
about 0.1% higher on the day, not far from the 18-month peak the index touched
last week.  
    As for Asian equities, stocks in Bangkok  .SETI , Mumbai  .NSEI , Manila
 .PSI  and Taipei  .TWII  gained in the 0.2%-1.2% range.
    Separately, investors will closely follow Argentinian assets after
president-elect Javier Milei visited the United States. The informal Argentinian
peso  ARSB=  had ended at 970 to the dollar. 

    HIGHLIGHTS:    
    ** Indonesia's benchmark 10-year bond yield remains steady at 6.739% 
    ** PBOC governor says will keep monetary policy accommodative, expects
inflation to pick up  urn:newsml:reuters.com:*:nL4N3CT0XG
    ** IMF keen to support Argentina, possibly through resilience trust
-Georgieva  urn:newsml:reuters.com:*:nL8N3CS4S6 

 Asia stock indexes and currencies at 0655 GMT
                                                                     
                                                                     
                                                                     
                                                                     
                                                                     
                                                                     
                                                                     
                                                                     
 Japan         JPY=         +0.27    -11.57   .N225            28.03
                                                               
                                                       -0.12   
                                                               
                                                               
 China         CNY=CFXS     +0.00     -3.53   .SSEC      0.15   -1.72
 India         INR=IN       -0.02     -0.80   .NSEI      0.17    9.52
 Indonesia     IDR=         +0.36     +0.84   .JKSE      0.61    3.00
 Malaysia      MYR=         +0.19     -5.78   .KLSE      0.04   -3.12
 Philippines   PHP=         +0.01     +0.45   .PSI       0.34   -4.19
 S.Korea       KRW=KFTC     +0.78     -2.26   .KS11      1.05   12.76
 Singapore     SGD=         +0.12     +0.35   .STI      -0.62   -5.66
 Taiwan        TWD=TP       +0.32     -2.42   .TWII      1.19   22.66
 Thailand      THB=TH       +0.47     -0.83   .SETI      0.45  -16.11
 
 (Reporting by Archishma Iyer in Bengaluru;Editing by Dhanya Ann Thoppil)
 ((Archishma.Iyer@thomsonreuters.com;))