Equities in the region were hemmed into a range and posted a weekly gain as expectations of upsized rate hikes led investors to exit bond markets and put money into equities.
Shares in Indonesia, Malaysia, the Philippines and Thailand were chasing gains of between 0.3 percent and 0.9 percent for the week.
Singapore’s Straits Times index was eyeing a 2.5 percent weekly gain, its third in a row, buoyed by the easing of COVID-19 restrictions in the city-state.
Regional bond markets stabilized on Friday.
Indonesia’s 10-year yields, among the top-yielders in the region, slipped to 6.711 percent, their lowest level since March 14.
“The global condition isn’t conducive enough (for Indonesian bonds) due to persisting pressures from both the geopolitical conflict in Ukraine and the Fed’s more aggressive measures on its tightening monetary policy,” Maybank analysts said.
“We expect investors to take momentum for applying ‘buy on weakness’ strategy for the rupiah bonds, especially for benchmark series.”
The Indian rupee and the Thai baht led gains among Asian currencies on Friday, supported by a weaker US dollar and as crude prices dipped after the United States and allies considered releasing oil reserves.
However, most regional currencies were still set to post declines for the week on the growing likelihood of aggressive US interest rate hikes and the Russia-Ukraine conflict that has made investors risk averse.
Investors over the week were also wary of oil importing nations, such as Thailand and India, which could suffer if Western economic sanctions were to hit Russian oil exports more severely. Oil prices were set to mark their first weekly gain in three.
The Indian rupee firmed 0.3 percent, while the baht appreciated nearly 0.5 percent on Friday. However, both the currencies were set to post a loss of 0.5 percent for the week, with the baht eyeing its fifth weekly loss in a row.
