ASEAN markets jump after surprise Fed decision

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BernankeSoutheast Asian stocks and currencies saw robust gains as investors returned to emerging markets after the US Federal Reserve surprisingly announced that there will be no change in stimulus measures.

Indonesian equities gained 4.5 per cent, while the Philippines added 2.9 per cent, Thai stocks opened up 3.31 per cent at the start of trade on September 19, Bursa Malaysia’s index rose around 6 per cent, and Singapore’s STI index around 1,6 per cent.

The Fed’s decision is a green light for global fund managers, after fears of a change in US monetary policy resulted in a volatile summer for Asia. Indonesia had been hit especially hard because of worries over their slowing economies and trade imbalances just as the fear of a rollback of US stimulus efforts, which had supported these markets for years, prompted substantial outflows.

Southeast Asian currencies also rallied, with Thailand’s baht rising as much as 2.5 per cent against the greenback, while Indonesia’s rupiah rose 2.4 per cent.

Fed chairman Ben Bernanke said that the unemployment rate has not improved enough to start tapering the Fed stimulus, and central bank policymakers were not confident enough yet that the economy could handle a reduction.

Financial markets had expected the Fed to announce it would begin tapering its monthly $85 billion in bond purchases by about $15 billion a month.

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Reading Time: 1 minute

Southeast Asian stocks and currencies saw robust gains as investors returned to emerging markets after the US Federal Reserve surprisingly announced that there will be no change in stimulus measures.

Reading Time: 1 minute

BernankeSoutheast Asian stocks and currencies saw robust gains as investors returned to emerging markets after the US Federal Reserve surprisingly announced that there will be no change in stimulus measures.

Indonesian equities gained 4.5 per cent, while the Philippines added 2.9 per cent, Thai stocks opened up 3.31 per cent at the start of trade on September 19, Bursa Malaysia’s index rose around 6 per cent, and Singapore’s STI index around 1,6 per cent.

The Fed’s decision is a green light for global fund managers, after fears of a change in US monetary policy resulted in a volatile summer for Asia. Indonesia had been hit especially hard because of worries over their slowing economies and trade imbalances just as the fear of a rollback of US stimulus efforts, which had supported these markets for years, prompted substantial outflows.

Southeast Asian currencies also rallied, with Thailand’s baht rising as much as 2.5 per cent against the greenback, while Indonesia’s rupiah rose 2.4 per cent.

Fed chairman Ben Bernanke said that the unemployment rate has not improved enough to start tapering the Fed stimulus, and central bank policymakers were not confident enough yet that the economy could handle a reduction.

Financial markets had expected the Fed to announce it would begin tapering its monthly $85 billion in bond purchases by about $15 billion a month.

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