Emerging Markets: Philippines leads Asian markets lower with inflation, rates in focus

Krung Thai Bank PCL

14/03/2022 06:51

* Philippines stocks at 5-yr low, Philippine peso near 3-yr
low 
    * Thai baht among top losers
    * High oil prices fuel inflation risk

    By Harshita Swaminathan
    March 14 (Reuters) - Asian equity benchmarks and most
regional currencies retreated further on Monday, as the
Russia-Ukraine war continued to rage and investors braced for
U.S. and UK interest rate hikes to counter surging inflation.
    The Philippines stock market  .PSI  slid 3.6% to a
five-month low, extending losses made on Friday after soaring
U.S. inflation data. The Philippine peso  PHP=  weakened 0.2% to
a near three-year low against the U.S. dollar.
    The Thai baht  THB=TH  lost 0.5%, partly hit by dampening
tourism prospects due to the COVID-19 pandemic. 
    China, which accounts for a large portion of Thailand's
tourism inflows, saw its daily new local symptomatic coronavirus
cases more than triple on Sunday, the highest daily number in
two years. The yuan  CNY=CFXS  lost 0.2% to hit its lowest level
in a month.  urn:newsml:reuters.com:*:nL2N2VG00Z
    Poon Panichpibool, a markets strategist at Krung Thai Bank,
said the baht had also weakened after Japanese firms in Thailand
repatriated funds ahead of their financial year-end.
    Many regional currencies continued to be under pressure with
oil prices still trading well over the $100/barrel mark even
after retreating from higher peaks scaled last week.
    "US$112/barrel of Brent crude is still not a happy sight in
the ASEAN region. The signs of fiscal distress is clearly
evident in the region", analysts at Mizuho Bank said, adding
that several countries in the region will likely have to
implement measures to cushion the hike in consumer fuel prices
and further hurt their currencies. 
    The rupiah lost 0.2%, while the rupee gained 0.1%.
    But analysts at Morgan Stanley expect the Indonesian rupiah
 IDR=  to outperform given the country's status as a net
commodity exporter and are bearish on the rupee  INR=IN  as they
project India's current account deficit will widen.
    Markets await the U.S. Federal Reserve's interest rate
decision due late on Wednesday, following recent data showing
inflation in the country grew at its fastest pace in four
decades.  urn:newsml:reuters.com:*:nL2N2VC2QK  FRX/  
    While markets have largely priced in a 25 basis points hike
to the federal funds rate, commentary with regard to inflation
and future rate hikes will be closely watched.  
    Japan's yen  JPY=  was also battered, shedding 0.4% against
the dollar. If the United States and UK raise rates this week as
expected, the Bank of Japan is set to be the sole remaining
major dovish central bank. 
    
HIGHLIGHTS:
** Indonesian bond yields  ID10YT=RR  down 5 basis points to
6.726% 
** Chinese stocks  .SSEC  drop 1.3% on higher COVID-19 cases,
weak new loans numbers; cyberspace regulator issues new rules

    
  Asia stock indexes and currencies                       
 at   0510 GMT                                      
 COUNTRY   FX RIC          FX     FX  INDE  STOCKS  STOCKS
                      DAILY %  YTD %     X   DAILY   YTD %
                                                 %  
 Japan      JPY=        -0.40  -2.27  <.N2   0.98   -11.75
                                      25>           
 China                               EC>           
 India      INR=IN      +0.08  -2.88  <.NS    0.16   -4.02
                                      EI>           
 Indonesi   IDR=        -0.17  -0.52  <.JK    0.46    5.67
 a                                    SE>           
 Malaysia   MYR=        -0.29  -0.95  <.KL   -0.46   -0.41
                                      SE>           
 Philippi   PHP=        -0.17  -2.69  <.PS   -3.56   -3.70
 nes                                  I>            
 S.Korea                             11>           
 Singapor   SGD=        -0.07  -1.15  <.ST   -0.68    3.33
 e                                    I>            
 Taiwan     TWD=TP      -0.33  -2.83  <.TW   -0.19   -5.42
                                      II>           
 Thailand   THB=TH      -0.51  -0.09  <.SE    0.08    0.10
                                      TI>           
  
    

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Graphic: World FX rates     https://tmsnrt.rs/2RBWI5E
Asian stock markets    https://tmsnrt.rs/2zpUAr4
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Harshita Swaminathan; Editing by Shivani Singh)
 ((Harshita.Swaminathan@thomsonreuters.com))