The rupiah fell as much as 2.7 percent to its weakest in more than four months.
SINGAPORE: Southeast Asian stock markets sank on Friday, with Indonesia hitting an eight-week low, on fears of higher U.S. interest rates under President-elect Donald Trump would spark capital outflows from the region.
Asia ex-Japan shares fell 1.4 percent, while emerging Asian currencies and bonds lost ground as U.S. bond yields continued to soar on views that Trump's spending plans will push up inflation, possibly triggering more aggressive rate hikes by the Federal Reserve.
Indonesian and Philippine shares were the worst hit, with Indonesia shedding as much as 3.3 percent.
The rupiah fell as much as 2.7 percent to its weakest in more than four months.
Indonesian markets have enjoyed relatively high inflows into it stock and bonds markets in the past few months, making them vulnerable to hot money outflows.
"Investors look to Indonesia when they think about emerging Asian markets and the resurfacing concern on trade likely weighed more heavily on the market," said Jingyi Pan, a market strategist with IG Asia in Singapore.
"Moreover, the slide in oil price overnight is likely to have further taken a toll on the rupiah."
Oil prices fell as the market refocused on a persistent fuel supply overhang that is not expected to subside unless OPEC and other producers make a significant cut to their output.
Philippine shares were 2.8 percent lower with Globe Telecom Inc posting its biggest percentage fall in over three years, declining as much as 5.7 percent.
Malaysian shares dropped as much as 1.7 percent to their lowest in over four months with financial and telecom stocks the worst hit.
The ringgit plunged to its weakest in more than 12 years in offshore markets as investors dumped government bonds, while the spot rate barely moved as the central bank kept a tight grip on the onshore market.
Meanwhile, central bank data showing the economy grew 4.3 percent from a year earlier, beating forecast, did little to placate markets. - Reuters
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