Asia FX mixed, Philippine peso rises on cenbank’s hawkish stance

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The Philippine peso rose on Wednesday

to its highest in nearly four months, after annual inflation

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data a day earlier showed a surge to a 14-year high in November,

reinforcing expectations of monetary tightening by the central

bank later this month.

The peso rose 0.7%, although it is down about 8.1%

this year, while equities in Manila dropped 0.7%.

The Southeast Asian nation’s consumer price index (CPI) rose

8.0% in November from a year earlier and year-to-date inflation

stood at 5.6%, well outside the central bank’s 2%-4% target for

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the year.

The Bangko Sentral ng Pilipinas (BSP) has lifted rates six

times this year and its governor last week hinted at another

hike of 25 or 50 basis points at the Dec. 15 meeting.

“PHP is doing well after the BSP’s statement yesterday that

it stood ready to take all necessary measures to bring inflation

back to target, plus President Marcos’ statement today decrying

‘out of control’ inflation,” said Alvin Tan, head of Asia FX

strategy at RBC Capital Markets.

Christopher Wong, a currency strategist at OCBC, said there

could be further gains in the peso, with the next level at 55.

The peso was trading at 55.48 per dollar as of 0339 GMT.

News about China loosening some of the world’s toughest

COVID-19 restrictions, with a negative test report no longer

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needed to enter supermarkets and offices in Beijing, further

aided risk sentiment.

Thailand’s baht advanced 0.2% and Indonesia’s rupiah

rose 0.1%. South Korea’s won and Singapore’s

dollar were both flat.

Stocks in Asia were broadly lower, with equities in Seoul

shedding 0.4% and Taiwan’s benchmark index down

0.5%. Stocks in Jakarta retreated 0.9%.

Equities in Kuala Lumpur and Bangkok were

the only gainers among the region’s stock markets, rising 0.3%

and 0.1%, respectively.

The Reserve Bank of India is widely expected to raise its

key lending rate by 35 basis points, according to economists

polled by Reuters, who expect another modest move up early next

year to curb lingering inflation pressures.

HIGHLIGHTS:

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** China’s Nov exports and imports shrink further, worse

than forecasts

** Indonesia sees end-2022 headline inflation in 5.34%-5.5%

range – minister

** BOJ must maintain ultra-easy policy, says board member

Nakamura

The following table shows rates for Asian currencies against

the dollar at 0339 GMT.

COUNTRY FX RIC FX DAILY FX YTD % INDEX STOCKS DAILY STOCKS

% % YTD %

Japan -0.11 -16.12 -0.64 -3.76

China +0.17 -8.99 -0.48 -12.16

India -0.13 -10.14 0.00 7.43

Indonesia +0.06 -8.68 -0.86 3.82

Malaysia -0.16 -5.32 0.26 -5.88

Philippines +0.67 -8.14 -0.72 -6.96

S.Korea -0.03 -9.88 -0.36 -19.92

Singapore -0.01 -0.70 -0.16 3.96

Taiwan -0.11 -9.73 -0.48 -19.54

Thailand +0.21 -4.68 0.12 -1.37

(Reporting by Upasana Singh in Bengaluru; Editing by Edmund

Klamann)