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EM stocks set to fall for first time in three weeks
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Dollar back in focus ahead of U.S. jobs data
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Serbian dinar flat ahead of cbank decision
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Markets in Argentina, Mexico and Colombia closed due to
holidays
By Shreyashi Sanyal and Shashwat Chauhan April 6 (Reuters) - A gauge for emerging market currencies was on track for its first weekly fall in four on Thursday at the end of a holiday-shortened week, as it lost steam against the dollar ahead of key readings on the U.S. labour market.
The MSCI's index for EM currencies fell 0.2% for the week, taking cues from global financial markets as traders cautiously awaited weekly U.S. jobless claims later in the day and private payrolls data on Friday.
Currencies in the developing world struggled to eke out gains, even as the dollar hovered around a two-month low as recent weak economic data caused a pull back in bets on how much longer the U.S. Federal Reserve's monetary policy would remain in a restrictive territory, while simultaneously spurring recession fears.
"The sentiment is changing, it's more and more negative," said Frantisek Taborsky, EMEA FX&FI strategist at ING. "If we see a hard landing or another shock like Credit Suisse and SVB, it would mean a higher U.S. dollar and at the same time, it would be negative for emerging markets."
South African rand hit a one-week low against the dollar, falling 0.7%, as gold prices weakened. The Russian rouble fell to a near one-year low, past the 80 mark to the dollar amid tight foreign exchange supplies and capital outflows amid limited liquidity. Russia's rouble-based MOEX Russia stock index rose 0.6%, gaining for the third straight session on support from high oil prices. The Serbian dinar was flat against the dollar ahead of the monetary policy decision from its central bank, which is widely expected to raise interest rates by 25 basis points to 6%. Poland's zloty edged lower against the euro ahead of central bank governor Adam Glapinski holding a press conference, following the bank's decision of holding interest rates steady at 6.75%. The Hungarian forint fell 0.5% against the euro after Wednesday's gains. Data showed Hungary's retail sales plunged 10.1% in annual terms in February following a 4.5% drop in January. The MSCI's EM stocks index fell 0.5%, bringing its weekly declines to 0.6%. It was set to post its first weekly decline in three.
South Africa's stock index gained 0.6%, while
Hungary's Budapest SE index rose 0.8% in its fifth
straight session of gain.
The Indian rupee was flat against the dollar after
the central bank held its interest rate steady in a surprise
move after six consecutive hikes, but hinted at hikes in the
future.
Trading volumes were thin ahead of Good Friday and Easter
holidays.
For GRAPHIC on emerging market FX performance in 2023, see For GRAPHIC on MSCI emerging index performance in 2023, see For TOP NEWS across emerging markets For CENTRAL EUROPE market report, see For TURKISH market report, see For RUSSIAN market report, see (Reporting by Shashwat Chauhan and Shreyashi Sanyal in
Bengaluru; Editing by Rashmi Aich)
