*
Singapore shares hit lowest level in nearly one month
*
Broad weakness seen across Asian stocks and currencies
*
Indian rupee hits lowest level since Jan 4
By Tejaswi Marthi Feb 15 (Reuters) - Most Asian currencies fell to on Wednesday to their lowest in more than a month, as the dollar firmed after persistently high U.S. inflation data cemented fears of more interest rate hikes by the Federal Reserve. While the month-on-month change in the headline consumer price index was in line with expectations, the annual rate of 6.4% was above estimates. The Malaysian ringgit fell 0.8% to hit its lowest level since Jan. 9, while the Thai baht shed 0.7% to touch its weakest point since Jan. 12. The Indian rupee eased 0.2% to hit its lowest level in more than a month.
Fed officials said on Tuesday the U.S. central bank would
need to keep gradually raising interest rates to beat inflation.
Money markets have fully priced in a 25 basis-point (bp) Fed
rate hike in March and are almost certain of one more in May. "The Fed made a mistake by slowing to 25-bp hikes too early.
We suggested that this would only elongate the current
tightening cycle. It is now more a case of death by a thousand
cuts, than the previous scenario of getting hit by a freight
train and then having to get back up," Clifford Bennett, chief
economist at ACY Securities, said in a note.
"The extended consistency of Fed rate hikes will wear on
consumer, business and investment nerves alike. Further
retrenchment of the consumer and business investment is a
certainty."
Equities in the region also fell. South Korean stocks dropped 1.6% to lead the losses, while Taiwanese shares fell 1.4%.
Singapore's finance minister, Lawrence Wong, said on Tuesday
he expected a slight deficit of 0.1% of GDP for the 2023 budget,
which was aimed at helping households manage pressures of rising
living costs and reviving the city-state's pandemic-depleted
coffers.
Singapore's trade-reliant economy faces headwinds this year
from slowing global growth, inflation and rising interest rates.
Meanwhile, its expenditures are increasing due to the
climbing cost of healthcare, driven by an ageing population.
"Budget 2023 has struck the right balance in addressing
immediate needs of households amid rising costs and helping
businesses level up their productivity and overall
competitiveness," DBS analysts said in a client note.
"Tighter monetary conditions, high inflation and
geopolitical tensions have exerted significant pressure on
global demand, weighing down on Singapore's growth prospects."
Singapore's dollar fell 0.4% and equities shed
1.2% to hit their lowest level in nearly a month.
HIGHLIGHTS:
** Indonesian 10-year benchmark yields rise marginally to 6.738%
** China retail investors from Gen-Z to retirees sit out
stock rally
** Indonesia posted a January trade surplus of $3.87
billion, beating forecasts, as exports expanded more than
expected, data from the statistics bureau showed. Asia stock indexes and currencies at 0611 GMT
COUNTRY FX RIC FX FX INDE STOCKS STOCKS
DAILY % YTD % X DAILY YTD %
%
Japan +0.03 -1.47 <.N2 -0.46 5.30
25>
China <CNY=CFXS -0.22 +0.79 <.SS -0.42 6.16
> EC>
India -0.13 -0.17 <.NS 0.14 -0.83
EI>
Indonesi -0.26 +2.44 <.JK -0.85 0.47
a SE>
Malaysia -0.80 +0.41 <.KL -0.34 -1.11
SE>
Philippi -0.71 +0.87 <.PS -0.05 3.37
nes I>
S.Korea <KRW=KFTC -1.08 -1.46 <.KS -1.58 8.51
> 11>
Singapor -0.37 +0.53 <.ST -1.13 0.90
e I>
Taiwan -0.39 +1.23 <.TW -1.42 9.16
II>
Thailand -0.81 +1.24 <.SE -0.05 -1.00
TI>
(Reporting by Tejaswi Marthi in Bengaluru; Editing by
Subhranshu Sahu)
