* Thai c.bank warns economy remains fragile, exposed to shocks * Philippines to continue easy money policy to support recovery * Singapore c.bank seen holding rates at October review - poll By Arundhati Dutta Sept 30 (Reuters) - The Thai baht hovered around a more than four-year low on Thursday, and was headed for its biggest monthly drop since July 2000, as the dollar gained on concerns over tapering plans by the U.S. Federal Reserve. The baht, which has been the region's worst performing currency in 2021 with an over 11% drop, was at its weakest since July 2017, while the greenback was near a one-year high on worries that the Fed could start hiking interest rates in 2022. The Bank of Thailand on Wednesday left its policy rate unchanged and signalled no reduction despite the tourism-reliant economy being hammered by a COVID-19 outbreak earlier this year, a move that analysts said would help catch the baht's tumble. The country's central bank said the economy remains fragile and has limited capacity to withstand shocks due to high external dependence amid a severe COVID-19 outbreak. A Reuters poll expects Singapore's central bank to leave monetary policy on hold at its October review, while the Philippine central bank promised to continue with accommodative policy settings until economic recovery gets fully underway. Both countries have seen new infections surge over the past few weeks. The index of emerging Asian currencies was on track for its worst month since March 2020. The Indonesian rupiah and the baht led regional currencies lower, with a 0.3% drop each. The dollar would continue to gain and pressurize Asian currencies if the Fed was indeed trying to move out of its pandemic-era accommodative stance, Jeffrey Halley, a market analyst at OANDA wrote in a note. "A disconnect between Asian and U.S. monetary policy has negative implications for most of Asia unless they want to start burning through foreign currency reserves," he added. As COVID-19 raged across Southeast Asia, MSCI's broadest index of Asia-Pacific shares outside Japan was set for its worst quarter since the pandemic first hit. For the day, most equity markets in the region rose as investors scooped up cheap stocks after last two days' China-driven sell-off, with Indonesia leading gains with a 1% jump. The Indonesian Parliament approved President Joko Widodo's $190 billion budget for next year. A power supply crunch in China due to demand-supply imbalance of coal has led to factory shutdowns across the country, making investors jittery that it may have a knock-on effect on China-reliant emerging Asian economies. Investors also cheered reports here that the U.S. Senate was working to fund federal agencies until early December to avert a government shutdown. HIGHLIGHTS: **Indonesian 10-year benchmark yields up 1.5 basis points at 6.348% **Thailand's 3-year benchmark yield up 3 basis points at 0.66% Asia stock indexes and currencies at 0718 GMT COUNTRY FX RIC FX FX INDE STOCKS STOCKS DAILY % YTD % X DAILY YTD % % Japan -0.04 -7.83 <.N2 -0.3 7.3 25> China <CNY=CFXS +0.08 +0.96 <.SS 0.90 2.74 > EC> India -0.16 -1.62 <.NS -0.16 26.47 EI> Indonesi -0.28 -2.02 <.JK 1.26 4.36 a SE> Malaysia -0.08 -3.99 <.KL -0.23 -5.11 SE> Philippi -0.11 -5.78 <.PS 0.27 -2.62 nes I> S.Korea <KRW=KFTC -0.19 -8.26 <.KS 0.28 6.80 > 11> Singapor -0.07 -2.99 <.ST 0.53 8.68 e I> Taiwan -0.12 +2.26 <.TW 0.47 14.95 II> Thailand -0.27 -11.7 <.SE -0.23 11.31 3 TI> (Reporting by Arundhati Dutta in Bengaluru; Editing by Rashmi Aich)
Our Standards: The Thomson Reuters Trust Principles.