* Philippines economy to shrink more than expected this year
* India unveils $265 billion stimulus package
* Malaysia Q1 GDP unexpectedly expands
(Adds text, updates prices)
By Anushka Trivedi
May 13 (Reuters) - Most Asian currencies were subdued on
Wednesday ahead of a speech by U.S. Federal Reserve Chairman
Jerome Powell, while investors worried that a rebound in global
coronavirus infections would delay economic recovery.
Financial markets gave up recent gains after the top U.S.
infectious disease expert warned overnight that a premature
lifting of restrictions could lead to additional outbreaks of
the novel coronavirus. A growing number of cases this week in countries, including
Germany, China and South Korea, that had reported early success
in containing the virus and had moved to relax some curbs also
weighed on investors' minds.
Consequently, South Korea's currency KRW=KFTC has declined
about 0.5% over three sessions.
"Second wave risk remains real and this could see
policymakers adopt more cautious steps ahead in opening up their
respective economies," Maybank analysts wrote in a note.
Dismal commentary from the Philippine and Malaysian central
banks on their respective economic growth prospects also hit
sentiment. The peso PHP=PH and the ringgit MYR=MY dropped
0.1% and 0.2%, respectively.
Philippines, which was among Asia's fastest-growing
economies before the pandemic, is now on the edge of a recession
as its central bank predicted a deeper-than-expected economic
contraction for this year due to a lack of demand and
investments. Malaysia, despite recording surprise jump in first-quarter
GDP, signalled a contraction in economic growth for three-months
ended June. Markets now await Powell's speech amid rising speculation
that the United States could one day adopt negative interest
rates after money market instruments started pricing in the odds
last week and President Donald Trump pushed the Fed to make the
move.
The Singapore dollar SGD= and the Indonesian rupiah IDR=
traded little changed.
The Indian rupee INR=IN firmed 0.2% after the government
announced a 20-trillion-rupee ($265.25 billion) stimulus
package, 10% of the country's GDP, to support the economy
bruised by a strict weeks-long coronavirus lockdown.
Further details will be given by Finance Minister Nirmala
Sitharaman later on Wednesday.
However, analysts sounded a note of caution.
"Significantly higher borrowings to finance an ambitious
fiscal stimulus will necessarily place stress on markets," said
Hayaki Narita, Asia & Oceania Treasury Department, Mizuho Bank.
"The headline allure of the fiscal stimulus may
unintentionally overstate the realizable economic benefits", he
added.
The following table shows rates for Asian currencies against
the dollar at 0603 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest Previous Pct
bid day Move
Japan yen 107.110 107.13 +0.02
Sing dlr 1.418 1.4175 -0.03
Taiwan dlr 29.885 29.920 +0.12
Korean won 1225.800 1224.8 -0.08
Baht 32.070 32.1 +0.09
Peso 50.253 50.21 -0.09
Rupiah 14875.00 14880 +0.03
0
Rupee 75.370 75.50 +0.17
Ringgit 4.333 4.325 -0.18
Yuan 7.089 7.0835 -0.08
Change so far in 2020
Currency Latest End 2019 Pct
bid Move
Japan yen 107.110 108.61 +1.40
Sing dlr 1.418 1.3444 -5.18
Taiwan dlr 29.885 30.106 +0.74
Korean won 1225.800 1156.40 -5.66
Baht 32.070 29.91 -6.74
Peso 50.253 50.65 +0.79
Rupiah 14875.00 13880 -6.69
0
Rupee 75.370 71.38 -5.29
Ringgit 4.333 4.0890 -5.63
Yuan 7.089 6.9632 -1.78
($1 = 75.4000 Indian rupees)