April,26(Agencies)— Asian currencies and equities fell on Wednesday as risk sentiment remained tepid after softening US data and renewed banking sector concerns fanned fears of a recession.
Malaysia’s ringgit weakened 0.4% to its lowest level in over a month, and Indonesia’s rupiah also declined 0.4%.
“Slump in US consumer confidence, Richmond fed manufacturing index and US equities overnight added to US recession worries and undermined risk sentiments,” analysts at OCBC wrote.
US markets fell sharply overnight and MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.4% in early trade, after US consumer confidence dropped to a nine-month low in April, further heightening the risk that the economy could fall into recession this year.
Meanwhile, reports of First Republic Bank considering asset sales after disclosing a $100 billion plunge in deposits stoked fresh banking sectors worries and further hurt investor sentiment.
Markets now await US March-quarter GDP and monthly personal consumption price index data due in the later in the week to gauge the direction of the Federal Reserve’s policy.
Stocks in Kuala Lumpur and Singapore fell 0.7% and 0.2%, respectively, while those in Jakarta added 0.5%. Markets in Indonesia resumed trading on Wednesday after being closed since April 19 for public holidays.
In the Philippines, the central bank governor said Bangko Sentral ng Pilipinas (BSP) aims to maintain its interest rate differential with the Fed and considers it “dangerous” to cut interest rates faster than a policy easing by Fed.
The peso weakene
Pakistan Rupee Exchange Rate