*
Philippine peso snaps four month winning streak
*
Thai baht set to lose 6.1% for the month
By Upasana Singh Feb 28 (Reuters) - Most Asian currencies and stock markets gained on Tuesday, boosted by a pause in the dollar's recent sharp rally which has been fuelled by rising expectations of further interest rate hikes by the U.S. Federal Reserve. The Philippine peso and the South Korean won led gains in the region, appreciating 0.6% and 0.3%, respectively. Indonesia's rupiah and India's rupee firmed 0.2% each, while China's yuan rose 0.1%. "A weaker U.S. dollar overnight is providing some room for relief, but the more measured gains suggest that there are still some doubts on whether the U.S. dollar weakness can continue in light of the recent upward trend," said Yeap Jun Rong, a market analyst at IG. The dollar index , which measures the greenback against six peers, rose 0.1% to 104.74 and was set to snap a four-month losing streak. A series of upbeat economic data from the United States has reinforced the strength of the world's largest economy and raised expectations that the Federal Reserve will keep rates higher for longer. "Inflation in the U.S. is proving to be stickier than expected, contrasting with many Asian economies where inflationary supply shocks from energy and food have faded," said Michael Loh, Asia FX strategist at BNP Paribas. "In turn, this is driving divergence of monetary policy both versus the U.S., as well as within the region." Since last month, most central banks in Southeast Asia have dialled back their policy tightening, with Malaysia's central bank unexpectedly pausing, the Philippine central bank signalling one more rate hike this year and the Bank of Thailand hinting at measured tightening ahead. Meanwhile, markets are expecting a third 25 basis point hike this year from the Fed and see rates peaking at 5.4% by September. Among the region's stock markets, equities in Manila gained 0.7% and Singapore's benchmark index was up 0.5%.
Jakarta shares added 0.2%, while stocks in Kuala Lumpur were the only outlier in the region with a 0.2% fall. Markets in Taiwan were closed for a public holiday.
HIGHLIGHTS:
** Japan's factory output shrank at the fastest pace in
eight months in January as declining overseas demand took a
heavy toll on key industries such as autos and semiconductor
equipment
** An influential Thai general involved in coups against two
elected governments called for an end to the country's bitter
power struggle, months away from an election in which he is
expected to seek the post of prime minister
The following table shows rates for Asian currencies against
the dollar at 0342 GMT.
COUNTRY FX RIC FX FX INDE STOCKS STOCKS
DAILY % YTD % X DAILY YTD %
%
Japan +0.00 -3.74 <.N2 0.43 5.54
25>
China <CNY=CFXS +0.13 -0.49 <.SS 0.07 5.53
> EC>
India +0.15 +0.01 <.NS 0.00 -3.94
EI>
Indonesi +0.20 +2.17 <.JK 0.19 0.25
a SE>
Malaysia -0.13 -1.83 <.KL -0.19 -2.86
SE>
Philippi +0.63 +0.92 <.PS 0.68 1.18
nes I>
S.Korea <KRW=KFTC +0.34 -4.10 <.KS 1.00 8.51
> 11>
Singapor -0.04 -0.56 <.ST 0.45 0.82
e I>
Thailand -0.27 -1.34 <.SE 0.24 -2.24
TI>
(Reporting by Upasana Singh in Bengaluru; Editing by Edmund Klamann)
