Asian currencies tepid, stocks higher ahead of Powell's testimony

Reuters

Asian currencies tepid, stocks higher ahead of Powell's testimony

2024 7월 9 일, 오전 8:02 GMT

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Indonesia stocks at highest since May 28

Indonesian rupiah falls after four straight sessions of gains

Malaysia and South Korea policy decisions on Thursday

Updates at 0710 GMT

By Ayushman Ojha

July 9 (Reuters) -Asian currencies were subdued on Tuesdaywhile regional stocks ticked up, as investors globally awaitedcomments from U.S. Federal Reserve Chair Jerome Powell to assess the prospectsof a rate cut in September.

Powell is scheduled to deliver his semi-annual monetary policy testimony before Congress at 1400 GMT.Investors are hopingfor dovish comments that will cement their bets on interest rate cuts this year, giving a fresh leg up to riskier assets and economies.

Despite a softer U.S. dollar, the Indonesian rupiah IDR= was down as much as 0.4% after four consecutive sessions of gains, while the Taiwanese dollar TWD=TP lost 0.2%.

The Thai baht THB=TH, andthe Singapore dollar SGD= were largely flat.

The South Korean won KRW=KFTC edged 0.1% higher andthe Malaysian ringgit MYR= was unchanged.Interest rate decisions from both countries are due on Thursday, where expectations are of a hold for now.

Both theBank Negara Malaysia and theBank of Korea are expected to keep their key policy rates on hold, according to Reuters polls.

"Currency weakness will remain the key constraint for these central banks in thinking about cutting interest rates ahead of the Fed," said Lloyd Chan, senior currency analyst at MUFG Bank.

The Philippine central bank has more scope to cut interest rates at its next meeting in August after annual inflation slowed in June, its Governor Eli Remolona said. The Philippine peso PHP= was 0.2% higher.

The U.S. consumer price data on Thursday will also be crucial in gauging the Fed's monetary policy path. Markets are now pricing in an 80% chance of a cut in September, up from 64% last week after recent data signalled a cooling economy. FEDWATCH

Indonesian shares .JKSE rose as much as 0.7%to their highest level since May 28, while Singapore stocks .STI gained 0.5%,still hovering near their record high touched last week.

The rally in Singapore shares is being driven by local bank stocks hitting record highs due to investor optimism about dividend payouts and higher-for-longer interest rates in the U.S. and Singapore, MUFG's Chan added.

Shares in Kuala Lumpur .KLSE gained as much as 0.4%, and Taiwan stocks .TWII rose 0.1% to a record high, while Thai stocks .SETI fell 0.3%, bucking the trend.

Markets are also awaiting China's inflation data on Wednesday and advancegross domestic product estimates from Singapore on Friday.

HIGHLIGHTS:

** Thailand central bank head says stronger growth needed

** Indonesia sees 2024 budget deficit at 2.7% of GDP, finance minister says

Asia stock indexes and currencies at 0710 GMT
COUNTRY	FX RIC	FX DAILY %	FX YTD %	INDEX	STOCKS DAILY %	STOCKS YTD %
Japan	JPY=	+0.04	-12.24	.N225	1.96	24.25
China	CNY=CFXS	-0.05	-2.39	.SSEC	1.19	-0.60
India	INR=IN	+0.02	-0.32	.NSEI	0.31	12.27
Indonesia	IDR=	-0.12	-5.38	.JKSE	0.58	0.28
Malaysia	MYR=	-0.02	-2.51	.KLSE	0.21	10.98
Philippines	PHP=	+0.17	-5.22	.PSI	0.42	1.65
S.Korea	KRW=KFTC	+0.09	-6.79	.KS11	0.34	7.99
Singapore	SGD=	+0.03	-2.24	.STI	0.47	5.56
Taiwan	TWD=TP	-0.24	-5.64	.TWII	0.09	33.29
Thailand	THB=TH	+0.00	-6.11	.SETI	-0.18	-6.76