Asian currencies rise on hopes of Ukraine top

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  • Thai baht lingers near five-month high
  • Thai economy returns to growth in fourth quarter
  • South Korean won rises on rising exports
  • Singapore stocks rise slightly after FY22 budget

Feb 21 (Reuters) – Asian currencies edged higher on Monday with the Thai baht leading the pack as risk appetite was boosted by plans by U.S. President Joe Biden and Russia’s Vladimir Putin to hold a summit on the Ukrainian crisis.

The Philippine peso and Singaporean dollar rose around 0.1% each, the South Korean won appreciated 0.2% on its third consecutive day of gains, while the Malaysian ringgit traded flat.

French President Emmanuel Macron’s office said in a statement Monday that it had offered both Biden and Putin a summit on “security and strategic stability in Europe.” The White House said Biden agreed to the meeting “in principle” but only “if an invasion did not occur.” Read more

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Investors see the summit as a beacon of hope out of the crisis that has rocked global markets in recent weeks. Read more

However, risk aversion sentiment persisted as market participants were cautious about any further developments between the two countries, as well as the prospect of aggressive policy rate tightening by the US Federal Reserve.

Heightened geopolitical risks combined with rising inflation concerns have added pressure to Asian markets in recent weeks.

“When a diplomatic solution to Ukraine is (hopefully) finally found, US yields should resume their upward trend and also help pull the dollar higher,” Brown Brothers Harriman analysts said in a note. of research.

The dollar should be boosted if Russian-Ukrainian tensions persist this week, analysts added.

In Asia, the Thai baht rose about 0.2%, lingering near its highest level in five months, after Southeast Asia’s second-largest economy reported stronger GDP growth. higher than expected for the fourth quarter thanks to the increase in exports and the recovery of domestic activity. Read more

The South Korean won also climbed around 0.1% after the Asian trade indicator’s exports jumped in the first 20 days of February, driven by higher external shipments of semiconductors and petroleum products. .

The Chinese yuan edged higher after the central bank held prime rates on one-year and five-year loans steady.

Emerging Asian stocks were under pressure, with the Philippines’ benchmark index (.PSI) falling the most, as much as 2.2% in its third straight session of losses.

Others like Malaysian stocks (.KLSE), Thai stocks (.SETI) and Taiwan stocks (.TWII) fell between 0.1% and 0.8%.

Meanwhile, Singaporean stocks edged higher, helped by Friday’s announcement of its fiscal year 2022 budget, where the fiscal year 2021 budget deficit was pegged at 0.9%. Read more

Shares in Indonesia (.JKSE) also gained around 0.2%.

STRONG POINTS

**US plans to sever ties with targeted Russian banks if Ukraine is invaded – sources read more

** Indonesia’s 10-year benchmark yield down to 6.494%

** The biggest losers in the South Korean benchmark are tech giants Samsung Electronics (005930.KS) and SK Hynix (000660.KS) down 0.81% and 1.52%.

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Reporting by Sameer Manekar and Archishma Iyer in Bengaluru; Editing by Shivani Singh

Our standards: The Thomson Reuters Trust Principles.

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