Asian currencies gain as Fed reassures on rates; Thai cbank in focus


BENGALURU: Thailand's baht came off a nine-month low on Wednesday and the Philippine peso snapped a six-day losing run, after U.S. Federal Reserve Chairman Jerome Powell said the central bank would not raise interest rates too quickly.

The baht firmed 0.4% and Thai stocks inched higher, as investors also awaited a Bank of Thailand meeting where the central bank is expected to leave interest rates at a record low and cut its growth forecast.

The tourism-reliant nation has seen revenues plummet over the last year due to the pandemic, prompting Prime Minister Prayuth Chan-ocha to announce a plan last week to gradually reopen Thailand to visitors within 120 days to revive the economy.

"The Bank of Thailand's comments on the reopening of the country will be key today," said Sunthorn Thongthip, a strategist with Kasikorn Securities, adding that investors will be looking at what it says about the economic impact of that.

Shares in the Philippines and Singapore led the way for emerging Asian stock markets, after Powell reaffirmed on Tuesday the Fed's intent to encourage a "broad and inclusive" recovery of the job market and to not hike rates too quickly based only on the fear of coming inflation.

Among currencies, the South Korean won rose 0.5%, while Indonesia's rupiah and Malaysia's ringgit also advanced modestly.

Emerging market assets, generally considered riskier investments, suffered broad losses since last week after the dollar rose when the Fed indicated it may raise rates earlier than expected and signalled tapering its bond buying programme.

"Markets may have assessed Powell's testimony as reassuring," said Yeap Jun Rong, a strategist at IG Markets.

Manila stocks were up 0.7% and the peso firmed 0.3%. Philippines' central bank is also widely expected to maintain record low rates in its meeting on Thursday.

HIGHLIGHTS

- Thailand's 10-year government bond yields are down 1 basis points at 1.66%

- Malaysia's 10-year benchmark yield is down 1.4 basis points at 3.282% - Reuters

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Baht , bond yields , Federal Reserve

   

Next In Business News

Downward pressure on ringgit continues
Bursa starts August on cautious note
Kenanga maintains 'market perform' on Maxis
Trading ideas: Axiata, Kerjaya Prospek, Westports, Maxis and Unisem
Quick take: Mi Technovation shares up on record profit
Unisem remains proxy for growth in semiconductor sector
Summary of top read business stories July 26 to 31
Mileage-based insurance with easy access emergency assistance
Pfizer and Moderna raise prices for COVID-19 vaccines in EU
Egypt's stock exchange to lift limit on share price moves to 20% from September

Stories You'll Enjoy


Vouchers