*

Malaysian ringgit extends fall to 10th session

*

Thailand Baht set for first weekly loss in five

*

Philippine central bank open to easing in 2025

(Updates at 0744 GMT)

By Aaditya GovindRao

Dec 20 (Reuters) - Most Asian currencies and stocks were

set on Friday to close the week lower, as a hawkish U.S.

interest rate outlook weighed on investor sentiment.

The Indonesian rupiah gained 0.6% on Friday after a

five-session losing streak, but was set to end the week near a

four-month low. Thailand's baht was down 0.1% and on

track for its first weekly loss in five.

After the Federal Reserve cut interest rates as expected on

Wednesday, central banks in Indonesia, Thailand, and Taiwan

maintained status quo to address currency and global economic

uncertainty concerns, while the Bangko Sentral ng Pilipinas cut

rates.

The MSCI's emerging markets currency index

has plummeted 0.6% this week, threatening to hit a fresh

four-month low if it breaks below Thursday's low.

Meanwhile, Fed Chair Jerome Powell's comments linking future

rate cuts to inflation progress prompted investors to scale back

policy easing expectations, implying only 37 basis points of

cuts in 2025 and sending the dollar to a two-year high against

major currencies.

Central bankers across Asia, from South Korea to India to

Indonesia, swiftly responded on Thursday, intervening in markets

by selling dollars to defend their currencies.

Emerging-market assets are likely to remain under pressure

as long as the U.S. dollar and Treasury yields stay elevated and

the threat of tariffs from the Trump administration persists.

"As a result of the incoming trade tariffs next year

contributing to stronger re-inflation bias, we expect the U.S

dollar to strengthen further against most major FX peers in

1H25," said Heng Koon How, head of markets strategy at UOB in

Singapore.

"Asian FX are expected to perform even weaker, to fall

alongside the Chinese yuan for the first three quarters of 2025

before stabilising in 4Q25."

The Philippine peso and Manila stocks rose

0.4% and 0.2%, respectively, after BSP Governor Eli Remolona

said the central bank was open to cutting rates at its first

policy meeting in 2025.

Shares in Taiwan dropped 1.8% after the central bank

on Thursday flagged growth risks in the coming year, stemming

from the trade policies of the incoming Trump administration in

the U.S.

The Malaysian ringgit lost 0.1% and was on course for

a tenth straight session of declines. However, it remains the

only currency among its Asian peers which is set to end the year

stronger.

HIGHLIGHTS:

** Malaysia's November consumer price index rises less than

forecast

** South Korea to loosen foreign exchange regulations

** Singapore's low inflation not enough for a January cut,

analysts say

Asian

stocks

and

currenc

ies at

0744

GMT

COUNTRY FX RIC FX FX INDE STOCK STOCK

DAILY YTD X S S YTD

% % DAILY %

%

Japan +0.32 -10. China 5 EC>

India +0.01 -2.1 Indones +0.56 -4.9 Malaysi -0.11 +1.8 Philipp +0.44 -5.8 S.Korea 15 11>

Singapo +0.14 -2.9 Taiwan -0.13 -6.0 Thailan -0.12 -1.0 (Reporting by Aaditya Govind Rao and Roushni Nair in Bengaluru;

additional reporting by Ankur Banerjee in Singapore; Editing by

Subhranshu Sahu)