Asian FX, stocks pressured as U.S. inflation rises, Thai baht leads losses

  • Malaysia's Q4 GDP expands 3.6%
  • Baht eyes worst session since Jan. 28
  • Philippines stock tumbles 2.2%
  • Japan markets closed for holiday

Feb 11 (Reuters) - Asian currencies and equities came under pressure on Friday as hotter-than-expected U.S. inflation dented risk sentiment and fuelled bets of more aggressive rate hikes, with the Thai baht and South Korea's won declining the most among peers.

Malaysia's ringgit was steady after data showed the economy returned to growth in the fourth quarter of 2021, expanding 3.6% from a year earlier, as economic activity resumed following the easing of coronavirus curbs. P8N2OQ03E

The ringgit was down 0.1% while stocks were up 0.3%.

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The baht was down 0.3%, tracking its worst session since Jan. 28. Thai consumer confidence dropped in January for the first time in five months, hurt by a spike in coronavirus cases, a slow economic recovery and high prices of goods, a survey showed on Thursday. read more

South Korea's won was down 0.2% to lead losses, while its stocks fell 0.5%.

Most Asian equities fell, with the Philippines (.PSI) leading the pack with a 1.5% drop, followed by Indonesia (.JKSE), down 0.4%. Thai shares (.SETI) were largely flat.

IG strategist Yeap Jun Rong said in a note that investors "did not seem to respond with an initial reaction (to the U.S. inflation data), suggesting that markets may want to look towards economic data to guide expectations, considering that we have seen many central banks walked back on their inflation stance."

The Federal Reserve's comments on rate hikes join ranks with a hawkish pivot at the European Central Bank last week, keeping the greenback and U.S. treasury yields firm. read more

The Indonesian rupiah was down 0.1% a day after the central bank governor said it would review policy rate levels in the third quarter to head off any spike in inflation next year. read more

"We will be getting inflation readings out of China next week, which will be one to watch considering its impact on global prices," Rong said.

Highlights:

** Indonesian 3-year benchmark yields are up 2.7 basis points at 4.439%​​

** Straits Times index (.STI) up 0.22% with Comfortdelgro Corporation Ltd (CMDG.SI) up 2.07%, DBS Group Holdings (DBSM.SI) up 1.17% and Sembcorp Industries up ​ 0.82%

** The NSE Nifty 50 index (.NSEI) fell 1.1%, while the S&P BSE Sensex (.BSESN) was down 1.1%

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Reporting by Savyata Mishra in Bengaluru

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