Fed Minutes Hurt Asian Markets

Shares and currencies in emerging Asian economies were hit by fears the US may scale back its bond-buying programme.

Stocks in Indonesia, Thailand and the Philippines fell, with the Philippine Stock Exchange down by more than 6%.

India’s rupee hit a new all-time low, while the Indonesia rupiah fell to its lowest level since 2009.

The programme has been used by the US Fed to boost liquidity in the market, a part of which has flowed into Asia, lifting assets price in recent years.

On Wednesday, the minutes of the July meeting of the US central bank, the Federal Reserve, showed that officials were “broadly comfortable” with plans to scale back the $85bn (£54bn) a month bond-buying programme.

While the minutes did not reveal any clues about when the measure may be tapered, analysts said that they did reinforce the view that the tapering will happen.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza