EMERGING MARKETS-Asian currencies, stocks subdued on Fed approach to easing

        *
      Malaysian ringgit extends fall to 10th session


        *
      Thailand Baht set for first weekly loss in five


        *
      Philippine central bank open to easing in 2025



    By Aaditya GovindRao
       Dec 20 (Reuters) - Asian currencies and stocks lost more
ground on Friday and were poised to close the week lower, as a
hawkish U.S. rate outlook kept investor sentiment subdued.
    The Malaysian ringgit and Thailand's baht
weakened the most among Asian currencies, shedding 0.2% each.
    The ringgit 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.
    The Indonesian rupiah traded largely flat, but was
set to end the week near a four-month low. It has weakened
nearly 8% since its September peak. The baht was 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."
    In a rare bright spot, the Philippine peso and Manila
stocks rose 0.4% and 1.2%, respectively, after BSP
Governor Eli Remolona said the central bank was open to cutting
rates at its first policy meeting in 2025.

    HIGHLIGHTS:
    ** China leaves benchmark lending rates unchanged
    ** South Korea to loosen foreign exchange regulations
    ** Malaysia's November consumer price index rises less than
forecast

  Asian
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 COUNTRY  FX RIC        FX    FX  INDE  STOCK  STOCK
                     DAILY   YTD     X      S  S YTD
                         %     %        DAILY      %
                                            %
 Japan               +0.21  -10.  China    6  EC>
 India               -0.01  -2.2  Indones             +0.03  -5.4  Malaysi             -0.16  +1.7  Philipp             +0.35  -5.9  S.Korea  17  11>
 Singapo             +0.05  -3.0  Taiwan              -0.13  -6.0  Thailan             -0.17  -1.1  (Reporting by Aaditya Govind Rao and Roushni Nair in Bengaluru;
additional reporting by Ankur Banerjee in Singapore; Editing by
Subhranshu Sahu)