(Sept 3): Emerging Asian currencies strengthened on Thursday, with the South Korean won near a 14-month high, while Malaysia’s ringgit and stocks were steady after the central bank kept rates unchanged as expected.
The MSCI emerging market currency index rose 0.4% to a record high as the dollar weakened and US Treasury yields retreated from multi-year highs ahead of US jobs data.
Oil prices edged lower but remained high amid uncertainty over renewed US-Iran strikes.
In Malaysia, the ringgit and stocks were largely unchanged after Bank Negara Malaysia (BNM) kept its overnight policy rate steady at 2.75% for a seventh straight meeting, as widely expected. The ringgit was up 0.1%, while stocks edged 0.2% higher.
The central bank said robust tech exports and tourism would support growth in 2027. It expects the economy to expand about 5% this year, at the top of its 4%-5% forecast range.
Lavanya Venkateswaran, senior Asean economist at OCBC, said subtle changes to BNM’s policy statement, including greater emphasis on inflation pressures and domestic demand, suggested a rate hike remained on the table, with OCBC still expecting a 25-basis-point increase in January 2027.”
The ringgit has risen 0.4% this year, supported by Malaysia’s relatively strong economy, fuel subsidies and resilient technology exports despite heightened geopolitical uncertainty.
Elsewhere, the South Korean won rose 0.2% near a 14-month peak, while Thailand’s baht gained 0.6%, on track to snap an eight-session losing streak. Indonesia’s rupiah advanced 0.5%.
In Japan, the yen extended gains on Thursday after a sharp jump in the previous session, with traders pointing to rising bets on Bank of Japan rate hikes rather than intervention by Japanese authorities. The currency gained 1.3%.
Traders also remained on edge over developments in the Middle East after the US and Iran exchanged their largest barrage of attacks since July, reviving fears of a broader regional escalation.
“Every rebound in Asia is trading the absence of bad news, not the presence of good news,” said Dilin Wu, strategist at Pepperstone, referring to the US-Iran war.
Among regional equities, stocks in Jakarta were up 0.9% to their highest level since mid-May, supported by blue-chip banks.
Singapore shares were little changed, up 0.1% after erasing earlier gains that took the benchmark to a record high. South Korean stocks rose 0.3%. The broader MSCI Emerging Asia index inched 0.1% higher.
Uploaded by Magessan Varatharaja
