SINGAPORE: Thailand’s baht and Indonesian rupiah led falls among Asian emerging market currencies on Monday, as the dollar held firm on prospects of US interest rates staying higher-for-longer, and surging crude prices counted against oil importing economies.

The baht depreciated by up to 0.6% to 36.785 per dollar, on track for its worst day since Aug. 3, as it remained under pressure due to surging oil prices, concerns over a widening fiscal deficit due to higher spending by the new Thai government, and weak economic data.

“Fiscal stimulus of this size is likely to stoke inflation to some extent, especially if it happens alongside the continued recovery in tourism and the positive turn of the global trade cycle,” analysts at HSBC said in a note.

“If the stimulus pushes core CPI higher than what the BoT (Bank of Thailand) already expects for 2024, then there is the risk that the BoT will resume its tightening cycle.”

Analysts at Maybank expect the baht - which has lost 2.7% in September quarter and is down nearly 6% so far this year - sees support for currency at 37.07 and resistance at 36.00.

Meanwhile, Thailand’s benchmark share index was 0.4% higher, after reversing course from a 0.7% decline earlier in the day. Thai shares are the region’s worst performers, with the index 11.6% so far this year.

Elsewhere, the Indonesian rupiah retreated 0.45% to 15,520.00, hovering near its lowest level since Jan. 11, while equities advanced 0.3%.