BENGALURU: Emerging Asian stocks were mixed while most currencies declined on Monday as concerns about flip-flopping US tariffs and a slowing US economy weighed on sentiment, with the Philippine peso being the only outlier.
Most regional currencies were unable to leverage the softer US dollar, with the Indonesian rupiah depreciating 0.3% while Singapore dollar, Malaysian ringgit and Thai baht trading marginally lower.
“The ongoing US trade probe, set to conclude by April 1, may trigger further tariff headlines, adding to FX uncertainty,” Goldman Sachs analysts wrote.
Over the weekend, US President Donald Trump declined to predict whether the world’s biggest economy could face a recession from the tariffs imposed on its trading partners.
Global markets have been hit by a whiplash of tariff measures from the US with the latest suspension of the 25% tariffs on most goods from Canada and Mexico until April 2.
It was the second time in two months that Trump has walked back tariffs on the US neighbours. Trump has also threatened to impose a global regime of reciprocal tariffs on all US trading partners from April 2.
The dollar index was at 103.85, near its four-month low, as investors fretted about a potential weakening of the US labour market while trade tensions played out.
The Philippines was the sole exception to the mixed markets, with the peso up 0.2% and shares rising to their highest since late January. The country’s stock index has been boosted by slower-than-expected inflation.
Following the lead of Bangko Sentral ng Pilipinas, Bank Negara Malaysia kept its key interest rate unchanged last week, while Indonesia and Thailand have reduced their interest rates this year.
Emerging market currencies have enjoyed a relatively favourable year so far with most of them logging gains.
The currencies of Singapore and Thailand were the biggest gainers among emerging Asian currencies, rising 2.6% and 1.6% respectively.
On the other hand, the Indian rupee and the Indonesian rupiah have been the worst-performing currencies with declines of 1.9% and 1.6%, respectively.
Thailand said it plans to initiate measures to push the country’s economic growth to 3% this year, which failed to drive stocks in Bangkok that were last down 1%.
Elsewhere, China’s consumer price index in February missed expectations and fell at the sharpest pace in 13 months, while producer price deflation persisted.
Chinese stocks shed 0.2% and the yuan slipped 0.3%.
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