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EMERGING MARKETS-Rupiah hurt by rate cut, bond outflows on dour economic outlook

Published 02/19/2021, 01:04 PM
Updated 02/19/2021, 01:10 PM
© Reuters.
USD/JPY
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USD/SGD
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JP225
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USD/IDR
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USD/MYR
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USD/PHP
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JARD
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NSEI
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US10YT=X
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JKSE
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KLSE
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ID10YT=RR
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KS11
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TWII
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SSEC
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SETI
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PSI
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KPIG
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STI
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KEPE
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PLAN
-

* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
* Indonesia benchmark bond yields up ~34 bps this week
* Rupiah at 3-week low
* Singapore shares drop 1%
* Indian currency markets shut

By Anushka Trivedi
Feb 19 (Reuters) - The Indonesian rupiah led losses among
Asian currencies on Friday, a day after the country's central
bank cut interest rates and trimmed the 2021 growth forecast,
with rising U.S. yields sparking bond outflows to weigh on the
currency.
Benchmark U.S. Treasury yields US10YT=RR returned to a
near one-year high level hit earlier this week, which has
pressured riskier Asian stocks and currencies across the board.
Despite a weaker greenback USD= , the Singapore dollar
SGD= , South Korean won KRW=KFTC and the Philippine peso
PHP= all declined between 0.1% to 0.2%.
The rupiah IDR= fell 0.4% to a three-week low, while local
stocks .JKSE slid, both on track for weekly losses as a
debilitating wave of COVID-19 infections caused Bank Indonesia
to trim rates by 25 basis points (bps) and downgrade the
economic outlook on Thursday. "The 2021 growth outlook was lowered...which is quite
disappointing, but rupiah may continue to focus on external
factors," said Daniel Dubrovsky, a strategist at trading
platform IG.
"Rising longer-term rates in the world's largest economy may
gradually slow the path for appreciation in the rupiah."
Indonesia's bonds, a foreign investor favourite, lost some
sheen with 10-year benchmark yields ID10YT=RR rising 5.1 bps
to 6.583%, their highest since November 5.
The bonds yields have jumped almost 34 bps so far this week.

Meanwhile, Philippine .PSI and Malaysia shares .KLSE
edged up after two sessions of heavy losses, while Singapore's
index .STI slumped 1.3%.
South Korea equities .KS11 continued their descent for
third day on recent jump in coronavirus cases, giving up most of
their vaccine-fuelled rally gains earlier this week. KRW/
Indian currency markets INR=IN were closed for a holiday,
while shares .NSEI fell 0.5% on profit-taking. .BO

HIGHLIGHTS
** Rupiah down about 1.1% since Tuesday
** Top losers on the Singapore STI .STI include: Jardine
Matheson Holdings Ltd JARD.SI down 2.9% and Keppel DC REIT
KEPE.SI down 2.1%
** Top losers on the Jakarta stock index .JKSE include
Planet Properindo Jaya PT PLAN.JK down 9.7% and MNC Land Tbk
PT KPIG.JK down 7%
Asia stock indexes and currencies at 0433
GMT
COUNTRY FX RIC FX DAILY FX YTD % INDEX STOCKS DAILY % STOCKS YTD %
%
Japan JPY= -0.01 -2.30 .N225 -1.16 8.89
China CNY=CFXS +0.27 +0.88 .SSEC -0.32 5.49
India INR=IN 0.00 +0.57 .NSEI -0.19 7.92
Indonesia IDR= -0.43 -0.21 .JKSE -0.40 3.29
Malaysia MYR= -0.05 -0.54 .KLSE 0.17 -2.99
Philippines PHP= -0.04 -0.91 .PSI 0.59 -3.50
S.Korea KRW=KFTC -0.07 -2.00 .KS11 -0.42 6.97
Singapore SGD= -0.12 -0.50 .STI -1.28 0.98
Taiwan TWD=TP +1.39 +1.94 .TWII -0.68 10.73
Thailand THB=TH -0.03 -0.20 .SETI -0.89 3.33

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