*

Indonesian rupiah drops as much as 0.5%

*

Hawkish comments from Fed supports dollar

*

Philippine c.bank seen holding interest rate - Reuters

poll

(Updates as at 0637 GMT)

By Rajasik Mukherjee

June 26 (Reuters) - The Indonesian rupiah hovered near

four-year lows on Wednesday, while other Asian currencies traded

in the red as the Federal Reserve's higher-for-longer monetary

policy stance pressured regional assets.

Hawkish comments from Fed officials on Tuesday knocked down

riskier Asian assets. Investors now await Friday's personal

consumption expenditures (PCE) price index - the Fed's preferred

measure of inflation - for any change to the rate cut outlook.

The U.S. dollar index, which measures the greenback

against a basket of major currencies, was trading slightly

higher at 105.760 during late Asian trading hours.

A higher U.S. interest rate environment supports the dollar,

pressuring emerging market assets.

Back in Southeast Asia, the Indonesian rupiah fell as much

as 0.5% to 16,445.0 per dollar, hovering around its lowest level

since April 2020, as a slew of domestic factors, in addition to

U.S. monetary policy, continued to pressure the currency.

The rupiah is facing headwinds from higher foreign exchange

demand from domestic companies and uncertainty related to the

country's fiscal plans.

"Near term, the rupiah could face further downward pressure.

A move towards the Covid-low of 16,625 vs the dollar cannot be

ruled out," said Christopher Wong, an FX strategist at OCBC.

"Comments (last week) about the rupiah's fundamental value

below 16,000, recent worries about domestic fiscal plans and

broad softness in Asian FX have further added to its softness."

Elsewhere in Asia, the Japanese yen pared back some

losses to trade flat, as of 0637 GMT, after the country's

central bank hinted at possible rate hikes in the near future.

The South Korean won shed as much as 0.3% on

Wednesday. Its central bank flagged the possibility of downward

pressure mounting again on the won, but vowed to step up

monitoring of risk factors and stabilise markets as required.

The Philippine peso traded slightly lower ahead of

its central bank's monetary policy meeting tomorrow, where rates

are expected to remain unchanged, a Reuters Poll showed.

The Taiwanese dollar lost 0.3%, while stocks

gained 0.5%, boosted by tech shares rising in tandem

with U.S. peers after Nvidia's ( NVDA ) overnight surge.

The Thai baht lost 0.3% while equities

traded flat. Stocks in Jakarta rose as much as 0.8%.

Among other emerging markets, the Mexian peso traded

slightly lower, as of 0637 GMT, ahead of the central bank's

monetary policy meeting.

HIGHLIGHTS:

** Indonesian 10-year benchmark yields ticks higher to

7.097%

** Steady dollar sends yen to the brink of 160

** BUZZ - Falling yuan may tip Asian currencies over the

edge

** MSCI's broadest index of Asia-Pacific shares outside

Japan up 0.2%

Asia stock indexes and

currencies at 0637 GMT

Japan -0.09 -11.7 +1.26 18.54

% %

China EC>

India -0.14 -0.41 Indones -0.33 -6.27 Malaysi -0.15 -2.55 Philipp -0.10 -5.83 S.Korea 11>

Singapo -0.04 -2.64 Taiwan -0.33 -5.57 Thailan -0.26 -7.10