Most Asian currencies were unchanged in thin trading on Monday ahead of a week with key Australian, UK and European central bank meetings, while stocks firmed though surging oil prices added to worries over inflation.

Most regional currencies were broadly flat against a strong dollar buoyed by rate hike expectations. Market pricing now suggests a more than 90% chance of at least four rate hikes by the end of the year in the world's largest economy and a 67% chance of at least five.

Stock markets across the region moved higher on Monday, with India and Philippine stocks firming about 1% each. Financial markets in China and South Korea were closed on Monday for the eve of Lunar New Year.

Indian shares opened sharply higher on Monday after two weeks of heavy losses, as beaten down technology stocks advanced with a slew of blue chip earnings and the federal budget in focus. India's rupee rose 0.1%.

In China, data on Sunday showed that the country's factory activity slowed in January as a resurgence of COVID-19 cases and tough lockdowns hit production and demand.

Asian currencies and stocks drop as investors brace for Fed rate hike

The Shanghai Composite Index has lost around 7.6% already this year, after rising nearly 5% in 2021.

Japan's Nikkei bounced 1.3% from a 14-month trough, though data on industrial output and retail sales undershot forecasts.

Malaysian stocks slipped 0.5% ahead of the country's money supply data for December, while Singapore's Straits Times Index inched 0.1% higher.

Highlights

** Top gainers on the Singapore STI include Genting Singapore Ltd, Singapore Technologies Engineering Ltd and SATS Ltd

** Indonesian 10-year benchmark yields are down 1 basis points at 6.454%