* Indonesia stocks rise up to 2% * Rupiah gains after three sessions of losses * Singapore shares up 0.8%, Taiwan stocks jump 1.8% (.) By
* Indonesia stocks rise up to 2%
* Rupiah gains after three sessions of losses
* Singapore shares up 0.8%, Taiwan stocks jump 1.8%
(.)
By Himanshi Akhand
March 20 (Reuters) - Indonesia's shares rose and the
rupiah strengthened on Thursday following the central bank's
decision to stand pat on interest rates, while other Asian
markets and currencies gained on the prospect that the Federal
Reserve may cut rates twice this year.
Shares in Jakarta extended gains, climbing as much
as 2%, after experiencing their biggest drop in nearly three
years on Tuesday.
The rupiah, Asia's worst-performing currency so far
this year, firmed 0.3% to 16,470 per dollar, marking its first
gain in four sessions.
Bank Indonesia (BI) kept policy rates unchanged on Wednesday
amid recent market turmoil, which saw investors withdrawing from
stocks and selling the country's high-yielding bonds due to
concerns over fiscal health and weakening domestic demand.
Indonesia's parliament passed controversial revisions to the
military law, granting more civilian positions to military
officers.
"In an environment of high macro policy and political
uncertainty, the risk of outflows from the equity market remains
visible – not only from foreign but also resident investors,"
Citi analysts said in a note.
Other regional stock markets tracked overnight gains in Wall
Street, with equities in Taiwan jumping 1.8%.
Singapore's stocks rose 0.8% to a near one-month
high, while South Korean shares gained 0.6%.
The U.S. Fed kept its benchmark interest rate unchanged
overnight, but projected likely two quarter-point interest rate
cuts later this year, calming investor nerves.
Even though U.S. policymakers expect faster-than-expected
price increases, partly due to President Donald Trump's plans to
levy duties on imports from trading partners, Chair Jerome
Powell's belief that tariff-driven inflation will be
"transitory" and mainly confined to this year helped boost risk
sentiment.
In contrast, Nomura analysts said that even before Trump
tariffs are fully implemented, disinflation is widespread in
Asia.
"As tariffs get implemented, downside risks to growth and
inflation will likely become more material."
Analysts said that, along with high real rates, there is
still room for easing by Asian central banks, especially in
Thailand, India, the Philippines, and Korea.
Regional currencies rose against the dollar, which remained
steady but hovered close to the five-month low touched earlier
this week.
The Malaysian ringgit and the South Korean won
added 0.2% each.
Elsewhere, the Turkish lira closed down 2.6% on
Wednesday after weakening to a record low of 42 per dollar, and
the benchmark stock index fell the most in four years
after authorities detained President Tayyip Erdogan's main
political rival.
HIGHLIGHTS:
** China holds benchmark lending rates steady, as expected
** Hong Kong central bank keeps base rate unchanged as Fed
holds steady
Asian stocks and currencies as of 0402 GMT
COUNTRY FX RIC FX FX INDEX STOCKS STOCKS
DAILY YTD % DAILY YTD %
% %
Japan +0.22 +5.95 - -
China
India +0.17 -0.79 0.48 -2.65
Indonesi +0.30 -2.31 1.48 -9.53
a
Malaysia +0.18 +0.99 -0.30 -7.87
Philippi +0.02 +1.64 0.19 -3.12
nes
S.Korea
Singapor -0.05 +2.55 0.64 3.85
e
Taiwan +0.12 -0.68 1.72 -3.02
Thailand +0.03 +2.11 0.20 -14.87
(Reporting by Himanshi Akhand in Bengaluru; Editing by Sherry
Jacob-Phillips)
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