Indonesian rupiah leads Asia FX gains ahead of Powell's speech
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Indonesia's rupiah up 0.87%; stocks gain 0.8%
Singapore dollar, stocks rise as inflation cools
Traders await Fed Chair's speech later in the day
By Rajasik Mukherjee and Archishma Iyer
Aug 23 (Reuters) -The Indonesian rupiah was the biggest gainer among buoyant emerging Asia currencies on Friday as the dollar dipped ahead of Federal Reserve Chair Jerome Powell's speech, which is expected to give cues on the timing and magnitude of a U.S. rate cut.
The rupiah IDR= ended 0.87% higher, while stocks in Jakarta .JKSE added 0.8%, as Southeast Asia's largest economy shelved planned changes to electoral laws that could have weakened opponents of the outgoing president and his successor.
The market reacted positively to the parliament ditching its plans to revise the laws, said Fakhrul Fulvian, an economist of Trimegah Securities.
Most emerging Asian currencies and stocks rose ahead of Powell's speech at the Jackson Hole symposium, which will be scrutinised for cues on the Fed's monetary policy plans. MKTS/GLOB
While the Fed is expected to all but cut rates in September, the markets are uncertain about the magnitude of the cut. Other global central banks tend to follow the Fed.
"With Fed rate cuts now seeming imminent, Asian currencies have finally snapped back into line with the narrowed yield gap since the start of the month," analysts from Capital Economics wrote in a research note.
Thailand's baht THB=TH gained 0.7% on easing fears of political upheaval following the appointment of Paetongtarn Shinawatra as the country's youngest prime minister.
Earlier this week, better-than-expected second-quarter GDP growth also generated some confidence among investors.
"Looking at (the) macro, the baht is set to benefit from further normalization post-pandemic. GDP growth and current account may remain supported by export demand and tourism recovery," said Jeff Ng, head of Asia Macro Strategy of Sumitomo Mitsui Banking.
The Singapore dollar SGD= gained 0.3%, while stocks .STI traded 0.3% higher, as the city-state posted its lowest core inflation since February 2022.
Among Asian shares, Bangkok's .SETI rose about 0.6%, while Seoul shares .KS11 closed 0.2% lower.
Markets in the Philippines were closed due to a public holiday.
HIGHLIGHTS:
** Japan's core inflation picks up in July, but demand-driven growth below 2%
** Kamala Harris formally accepts Democrats' nomination for president
** High food prices in India threaten overall inflation outlook, say rate panel members
Asian currencies and stocks at 0715 GMT | ||||||
COUNTRY | FX RIC | FX DAILY % | FX YTD % | INDEX | STOCKS DAILY % | STOCKS YTD % |
Japan | JPY= | +0.49 | -3.08 | .N225 | 0.40 | 14.64 |
China | CNY=CFXS | +0.17 | -0.54 | .SSEC | 0.23 | -4.02 |
India | INR=IN | +0.10 | -0.79 | .NSEI | 0.09 | 14.28 |
Indonesia | IDR= | +0.87 | -0.42 | .JKSE | 0.85 | 3.84 |
Malaysia | MYR= | +0.09 | +4.99 | .KLSE | -0.37 | 12.43 |
Philippines | PHP= | - | -1.79 | .PSI | - | 7.94 |
S.Korea | KRW=KFTC | +0.51 | -3.64 | .KS11 | -0.22 | 1.75 |
Singapore | SGD= | +0.25 | +0.90 | .STI | 0.31 | 4.44 |
Taiwan | TWD=TP | +0.04 | -3.81 | .TWII | 0.04 | 23.58 |
Thailand | THB=TH | +0.67 | -0.34 | .SETI | 0.61 | -4.71 |
Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
Asian stock markets https://tmsnrt.rs/2zpUAr4
Reporting by Rajasik Mukherjee and Archishma Iyer in Bengaluru; Editing by Stephen Coates and Savio D'Souza
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