EMERGING MARKETS – Asian markets fall on inflation; rising oil prices weigh on indian rupee

Band Savyata Mishra

April 18 (Reuters)The energy-sensitive Indian rupee weakened on Monday, hurt by higher oil prices on concerns over tight global supply, while other Asian currencies traded lower against a stronger US dollar as inflationary pressures intensified.

Regional sentiment was rocked by expectations of a further aggressive tightening of US rate policy, even as investors placed cautious bets following an extended holiday weekend.

The Rupee RNI=IN plunged as much as 0.3% to 76.43, its lowest level since March 22, further pinned by a selloff in Indian stocks .NSEIdown almost 2%. OR

The Malaysian ringgit MYR=the Taiwanese dollar TWD=TP and South Korea won KRW=KFTC down about 0.3% each.

Investors appeared to show little reaction to China’s central bank’s decision on Friday to cut the amount of cash lenders must hold as reserves for the first time this year, a move to cushion a potentially sharp slowdown in economic growth.

With no market clues in Europe due to the Easter holiday, investors focused on key economic data from China earlier in the day.

Data showed China’s economy grew at a faster than expected pace in the first quarter, growing 4.8 percent year-on-year. But the risk of a sharp downturn over the next few months has increased as sweeping COVID-19 restrictions and the war in Ukraine take their toll.

Yet Chinese stocks .SSEC fell 0.8% as market participants dismissed the PBOC’s move as falling short of expectations, and perhaps not enough to reverse the economic slowdown. .SS

“This cut will do little to rekindle growth momentum as Shanghai’s lockdown, geopolitical tensions and real estate sector concerns remain largely unaddressed,” according to a note from Mizuho Bank.

The Singapore dollar CAD= weakened by 0.3%, while the Philippine peso PHP= reduces early losses to trade 0.1% less.

Similarly, the Thai baht THB=TH and the Indonesian rupiah RDI= fell slightly by 0.1%.

Among equities, banking stocks led the Singapore benchmark .STI Down 0.7%, its lowest levels since March 17, while Malaysia .KLSE fell for a third consecutive session, plunging 0.3%.

“There is some hesitation in the equity market ahead of Singapore banks’ results. Interest rates may have topped expectations and a countertrend could be underway in favor of rate-sensitive sectors. interest such as REITs,” said Paul Chew Kuan Leng. , said the head of Phillip Securities Research.

Jakarta Stocks .JKSE were an outlier in the region, climbing 0.4%, driven by rising energy prices and ahead of a central bank monetary policy meeting where an interest rate hike is expected as risks inflation persist.

“While BI (Bank Indonesia) is the central bank’s most important meeting this week, the focus will be on the various Fed members scheduled to speak,” Mizuho Bank said.

Separately, the resource-rich country’s exports and imports hit record highs in March amid rising commodity prices due to the impact of war in Ukraine, according to data from the statistics office.

STRONG POINTS:

** Thai stocks .SETI down 0.1%, Philippines .PSI up 0.1%

** Malaysia’s benchmark 10-year yield hits a 4-year high

** Top losers in Singapore .STI Index: Jardine Matheson Holdings JARD.IF down 1.57%; Hongkong land properties HKLD.SI 1.44%; United Overseas Bank UOBH.SI 1.24% to S$30.38

Asian Stock Indices and Currencies at 0606 GMT

COUNTRY

FXRIC

DAILY FX %

FX YTD %

HINT

DAILY STOCKS %

INVENTORY YTD %

Japan

JPY=

-0.22

-9.12

.N225

-1.28

-7.10

China

CNY=CFXS

-0.04

-0.29

.SSEC

-0.43

-12.16

India

RNI=IN

-0.27

-2.69

.NSEI

-1.81

-1.13

Indonesia

RDI=

-0.08

-0.73

.JKSE

0.39

10.37

Malaysia

MYR=

-0.31

-1.93

.KLSE

-0.31

3.03

Philippines

PHP=

-0.13

-2.36

.PSI

0.07

-1.86

South Korea

KRW=KFTC

-0.29

-3.62

.KS11

-0.04

-9.49

Singapore

CAD=

-0.29

-0.82

.STI

-0.67

6.07

Taiwan

TWD=TP

-0.31

-5.25

.TWII

-0.62

-7.25

Thailand

THB=TH

-0.06

-0.80

.SETI

-0.05

0.96

Chart: World exchange rates https://tmsnrt.rs/2RBWI5E

Asian scholarshipshttps://tmsnrt.rs/2zpUAr4

(Reporting by Savyata Mishra in Bengaluru; Editing by Sherry Jacob-Phillips)

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Steve R. Hansen