FX in wait-and-see mode ahead of Powell speech, stocks inch down
Updates at 0900 GMT
Turkish lira weakens to 34 per dollar
Markets focus on Fed chair's speech at 1400 GMT
China meets industry groups over EU's EV tariffs
Stocks down 0.1%, FX flat
By Shubham Batra
Aug 23 (Reuters) -Emerging market currencies were subdued on Friday as investors stayed on the sidelines and waited for a crucial speech by the U.S. Federal Reserve Chair Jerome Powell later in the day, while regional stocks edged lower.
MSCI's gauge for emerging market currencies .MIEM00000CUS was flat, with focus firmly on Powell's address at the Jackson Hole symposium at 1400 GMT, which will likely provide strong clues on the extent and timing of U.S. rate cuts.
Investors expect the U.S. central bank to cut interest rates by 25 basis points in September and emerging market currencies will be highly sensitive to any monetary policy signals by Powell. 0#FEDWATCH
The Turkish lira TRYTOM=D3 dropped to a record low of less than 34 per dollar, with markets watching for July foreign arrivals data that will shed light on the country's prospects for economic stability and growth.
The South African rand ZAR= advanced 0.5% against a softer U.S. dollar ahead of Powell's speech.
Most currencies in the central and eastern Europe (CEE) were higher against the euro, with the Hungarian forint EURHUF= inching up 0.1% after unemployment in the country fell marginally to 4.2% in the quarter ended in July compared with 4.3% in the April-June quarter.
"CEE is outperforming the emerging market space, and given the rather dovish market expectations in the region ... CEE currencies should be supported and maintain at least current levels, with more gains later," said Frantisek Taborsky, EMEA FX strategist at ING.
The MSCI's guage for regional stocks .MSCIEF was down 0.1%, dragged lower by the losses of index heavyweights including Taiwan Semiconductor 2330.TW and Tencent Holdings 0700.HK.
China stocks .CSI300 gained on Friday, ending a run of three consecutive session of losses, after the Commerce Ministry met automakers and industry associations to discuss raising import tariffs on large-engined gasoline vehicles. That would sound a warning to the European Union as it nears a tariff decision on Chinese electric cars.
Shares of South African gold mining company Gold Fields GFIJ.J sank more than 5% after it cut its annual output forecast for the second time this year following a harsh winter in Chile that hobbled a planned output ramp up at a new mine.
In Argentina, President Javier Milei will veto a pension reform passed on Thursday by the Senate in a move that is likely to widen an ongoing rift between the libertarian leader and the opposition-controlled Congress.
For TOP NEWS across emerging markets nTOPEMRG
For CENTRAL EUROPE market report, see CEE/
For TURKISH market report, see .IS
For RUSSIAN market report, see RU/RUB
For GRAPHIC on emerging market FX performance in 2024 http://tmsnrt.rs/2egbfVh
For GRAPHIC on MSCI emerging index performance in 2024 https://tmsnrt.rs/2OusNdX
Reporting by Shubham Batra and Medha Singh in Bengaluru;
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
