* Graphic: FX rates around the world tmsnrt.rs/2RBWI5E
* Analysts predict the BSP will remain dovish for longer * Singapore stocks rise 1% China’s stock price is falling.
Anushka Trivedi contributed to this article.
Reuters, July 6 – On Tuesday, Philippine stocks and the peso fell as investors worried about an alarming mix of rising inflation and an economic downturn.
The peso lost 0.3 percent to 49.48 pesos per dollar, while stocks sank 0.4 percent, as data indicated that the consumer price index (CPI) jumped 4.1 percent in May, with the six-month average of 4.4 percent coming in beyond the central bank’s goal range of 2 percent to 4% for 2021.
As higher crude prices impacted on the currencies of most oil importers in the area, the peso stumbled to one-year lows, while its rivals made only tiny advances. The rupiah in Indonesia and the Singapore dollar both gained 0.1 percent.
The peso had been on a downward trajectory, like its Asian counterparts, since the Federal Reserve startled investors with a hawkish move in June.
The peso was on the back foot, according to Nicholas Mapa, senior economist at ING, as economic data continued to suggest to a sluggish recovery even as the country grappled with a high viral case burden.
Following a larger-than-expected drop in gross domestic product in the first quarter, the Southeast Asian nation cut its economic growth forecasts for this year and next.
In other markets, Singapore stocks rose 1%, with travel and leisure companies leading the way, as the city-gradual state’s withdrawal from virus controls and rapid immunization fueled optimism for a strong economic comeback.
In a note, Citi analysts estimated that GDP would expand by 7% in the second half, supported by exports, as Singapore’s broader economic activity recovered pre-COVID levels earlier than planned.
Thai equities jumped 0.7 percent on news that the country’s government was considering imposing a tax on individual stock transactions.
In other news, the Reserve Bank of Australia announced at a critical policy meeting that it would reduce its bond-buying program as the country’s economy strengthened.
HIGHLIGHTS
** The minutes of the June FOMC meeting will be released on Wednesday ** Thai exports are expected to increase by more than 7% y/y in Q3 – shippers ** China’s stocks are down 0.5 percent on concerns over a crackdown on IT businesses.
At 04:52 GMT, Asian stock indices and currencies were trading.
INDEX STOCKS DAILY percent STOCKS YTD percent COUNTRY FX RIC FX DAILY percent FX YTD percent COUNTRY FX RIC FX DAILY percent FX YTD percent COUNTRY FX RIC FX DAILY percent FX YTD percent COUNTRY FX
+0.13 -6.84 0.35 4.57 Japan +0.13 -6.84 0.35 4.57 Japan +0.13 -6.84
China +0.01 +1.01 -0.53 1.23 1.23 1.23 1.23 1.23 1.23 1.23 1.23 1.23 1.23 1.23 1.
India +0.04 -1.62 0.17 13.44 +0.04 -1.62 0.17 13.44 +0.04 -1.62
Indonesia +0.11 -2.90 0.51 0.96 Indonesia +0.11 -2.90 0.51 0.96 Indonesia +0.11 -2.
Malaysia +0.04 -3.19 0.08 -5.75 Malaysia +0.04 -3.19 0.08 -5.75 Malaysia +0.04 -3.
Philippines -0.27 -2.97 -0.52 -1.96 Philippines -0.27 -2.97 -0.52 -1.96 Philippines -0.27 -2
S. Korea +0.04 -3.99 0.43 15.10 S. Korea +0.04 -3.99 0.43 15.10 S. Korea +0.04 -3.99 0.43
+0.09 -1.71 1.18 11.75 Singapore +0.09 -1.71 1.18 11.75 Singapore +0.09 -1.71
Taiwan -0.00 +2.03 0.05 21.69 Taiwan -0.00 +2.03 0.05 Taiwan -0.00 +2.03 0.05 Taiwan
Thailand -0.03 -6.72 0.83 9.87 Thailand -0.03 -6.72 0.83 9.87 Thailand -0.03 -6
(Bengaluru-based reporter Anushka Trivedi contributed to this report, which was edited by Shri Navaratnam.)/n
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