Asian financial markets to take back seat<\/p>\n
SINGAPORE (AFP): Investors in Asian currencies and stock
\nmarkets are expected to stay largely on the sidelines this week
\ndue to Indonesia's historic polls, expectations of more fiscal
\nstimulus measures by Japan and jitters over possible U.S.
\ninterest rate rises.<\/p>\n
Asian currencies traded rangebound in the past week to end
\nsteady against the U.S. dollar. Stock markets kept wary eyes on
\nU.S. jobless data that could help point the direction of U.S.
\ninterest rates.<\/p>\n
The focus this week will be on the conduct of Indonesia's
\nfirst free elections in four decades Monday, analysts said,
\nnoting that campaigning had been relatively peaceful.<\/p>\n
\"We expect trade to be sidelined because results will not be
\nknown immediately,\" said Thio Chin Loo, currency strategist at
\nBanque Paribas here.<\/p>\n
Official results are not expected for around three weeks \"so
\nit's likely we could see some inactivity in the market,\" she
\nadded.<\/p>\n
Currency players would also await an expected announcement on
\nFriday by Tokyo of more fiscal stimulus measures.<\/p>\n
\"The markets could also be sidelined ahead of plans for fiscal
\nstimulus measures to be announced by Japan on Friday,\" Thio Chin
\nLoo said.<\/p>\n
\"We're not expecting anything specific, just a general outline
\nof measures on employment and industrial revitalization.\"<\/p>\n
Following the release of figures showing that the jobless rate
\nin Japan remained at a high in April, analysts have said they
\nexpect an additional spending package by Japan later in the year.<\/p>\n
Asia's stock markets may take their cue from Wall Street. The
\nDow last Friday closed 136.15 points higher at 10,799.84, as the
\nU.S. announced that unemployment sank in May to its lowest level
\nsince 1970, but that the economy created far fewer jobs than in
\nprevious months.<\/p>\n
Confusion ensued as traders on Wall Street tried to guess
\nwhether the figures would increase the prospects of the Federal
\nReserve raising interest rates to stave off inflation.<\/p>\n
Some hoped the figures would encourage the Fed to leave
\ninterest rates alone when its policymaking board meets end-June.<\/p>\n
There are fears that any rise in U.S. rates will trigger a
\nround of similar rises in global markets, hampering Asia's
\neconomic recovery.<\/p>\n
But Goldman Sachs' Asia economics research team said it did
\nnot expect a rise in short-term interest rates soon in the
\nregion.<\/p>\n
\"While we believe that short-term interest rates in most of
\nnon-Japan Asia have bottomed -- the notable exceptions being
\nIndonesia, Taiwan and China -- we do not see this bottoming as
\ngiving way to an upturn in the near-term horizon,\" it said in a
\nrecent report.<\/p>\n
It said it was \"more confident\" Asia \"will be able to combine
\naccelerating growth without material inflationary pressure.\"<\/p>\n
\"The large output gap remaining in the region, combined with
\ncorporate and financial restructuring, will keep the lid on
\ninflation for quite some time,\" Goldman Sachs said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asian-financial-markets-to-take-back-seat-1447893297",
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