Asian currencies: Peso, rupiah slide in thin Asia trade

BENGALURU: Philip pine equities dropped more than 1 percent and the peso weakened against the US dollar on Monday, as investors stayed away from the archipelago over concerns tied to a corruption scandal and persistent social unrest.

The MSCI Emerging Asia Index and a broader MSCI Asia-Pacific ex-Japan Index both eased about 0.5 percent, retreating from their highest levels since 2021 hit in the previous session.

Trading volumes in emerging Asia equities stood well below the 30-day average as market closures in China, Taiwan, and South Korea affected momentum, with the latter two heavyweights being the major beneficiaries of the recent AI-driven rally.

In the Philippines, the equity benchmark gauge dropped as much as 1.8 percent, snapping a three-day winning streak. The index lost 3.3 percent over the past month amid widespread protests pertaining to a widening corruption scandal.

The Philippine president appointed a former Supreme Court justice in mid-September to head a new commission which will investigate alleged corruption in infrastructure projects, focusing on flawed flood control facilities exposed after monsoon rains and storms flooded towns and cities.

“The market (Philippines) continues to be out of favour despite the recent sell off and unlikely to see improvement in the near term in my view,” said Rajat Agarwal, Asia equity strategist at Societe Generale.

Its currency, the peso, weakened 0.6 percent against the dollar on Monday, after having fallen over 2 percent in September.

Investors are now focused on the Bangko Sentral ng Pilipinas (BSP) policy decision later this week. Maybank and DBS expect the central bank to hold rates steady, while Standard Chartered forecasts another cut.