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08 December 2023

Asian stocks tumble amid hawkish Fed jitters; currencies mixed

By Reuters

Most Asian stocks retreated on Tuesday, while currencies in the region were mixed as hawkish comments from two U.S. Federal Reserve officials overnight made investors cautious ahead of key inflation data later in the week.

Equities in Indonesia fell as much as 1.6%, hitting their lowest level since July 2022.

Stocks in Singapore and Malaysia slid 0.9% and 0.6% respectively, with equities in Manila down 0.4%. Analysts at OCBC said that hawkish rhetoric from Fed officials Raphael Bostic and Mary Daly, who said they expect rates to go somewhere over 5%, shook earlier market confidence that the U.S. central bank was near a pivot point. "

Asian markets are likely to temper their initial start of the year optimism today amid renewed concerns about a hawkish Fed notwithstanding that China's re-opening remains a silver lining," they wrote in a note. In the Philippines, central bank governor Felipe Medalla said inflation is likely to be closer to 3% in late 2023 and in 2024, adding that the economy remained strong and that pent-up domestic demand will continue driving growth.

The peso rose for a fifth consecutive session, adding as much as 0.2% to touch its highest level since June 2022. Still, most regional currencies were mixed.

The South Korean won added 0.3%, while the Singaporean dollar and the Thai baht declined 0.1%.

The yuan, which has strengthened 2.2% against the dollar this year, boosted by reopening of the country's borders, was up 0.1%.

However, three state financial newspapers in Shanghai and Beijing warned investors that the Chinese currency would be volatile in both directions this year.

Meanwhile, core consumer prices in Tokyo rose a faster-than-expected 4.0% in December from a year earlier, exceeding the central bank's 2% target for a seventh straight month in a sign of broadening inflationary pressure.

The Japanese yen was flat. Elsewhere, Brazil's real last stood at 5.2546 per dollar, having fallen more than 1% on Monday after supporters of former President Jair Bolsonaro stormed the capital. It had yet to trade as of Asia hours on Tuesday.


The Philippines recorded a trade deficit of $3.7 billion for November, despite a decline in the value of imports and a rise in exports.

Top losers on the Jakarta stock index include property developer Pudjiadi Prestige Tbk PT and telecoms services provider Visi Telekomunikasi Infrastruktur Tbk PT .

In the Philippines, top index losers are Bank of the Philippine Islands and conglomerate Ayala Corp Asia stock indexes and currencies at 0434 GMT

COUNTRY FX RIC FX FX INDE STOCKS STOCKS DAILY % YTD % X DAILY YTD % % Japan -0.03 -0.61 <.N2 0.79 0.30 25> China <CNY=CFXS +0.05 +1.93 <.SS -0.18 2.63 > EC> India +0.16 +0.60 <.NS -0.49 -0.51 EI> Indonesi -0.18 -0.18 <.JK -1.68 -4.01 a SE> Malaysia +0.02 +0.64 <.KL -0.59 -0.73 SE> Philippi +0.18 +1.53 <.PS -0.50 2.89 nes I> S.Korea <KRW=KFTC +0.30 +1.99 <.KS 0.22 5.32 > 11> Singapor -0.08 +0.64 <.ST -0.88 0.78 e I> Taiwan +0.27 +0.88 <.TW 0.21 4.57 II> Thailand -0.06 +3.39 <.SE -0.09 1.25 TI>