Week Ahead for FX, Bonds: Markets Nervously Await -2-

Focus will also be on the country's official purchasing managers' indexes for June, due Sunday June 30, which will be scrutinized for evidence that the governments' ramped-up policy push is boosting the economy.

May's PMIs signaled that manufacturing activity unexpectedly slid into contraction, pointing to weak demand and industrial overcapacity. The non-manufacturing PMI, which covers both service and construction activity, also fell in May but stayed in growth territory.

Weaker-than-expected readings could spur hopes of bolder policy rollouts, particularly ahead of the ruling Communist Party of China's Third Plenum in July, which has been in the past used to announce economic policy reforms.

PHILIPPINES

The Philippines central bank will announce its rate decision Thursday amid speculation over whether the country will opt to cut ahead of the Federal Reserve.

"There is little chance of a hike here," as the Philippine peso remains the region's weakest currency and has needed the central bank's intervention to support it, ING analysts said. The central bank will likely hold rates until after the Fed cuts, ING added.

Asian central banks tend to move somewhat in lockstep with their U.S. counterpart, and economists have been watching for months to see which would be the first to break rank and start lowering borrowing costs that are at historically high levels in much of the region.

The most recent central bank decision in Southeast Asia was Bank Indonesia, which held rates in a widely expected decision.

SINGAPORE

Singapore watchers will be looking at inflation data for May on Monday for signs of whether price pressures are stabilizing. In April, inflation held steady after a bumpy start to the year.

OCBC Chief Economist Selena Ling expects the city-state's headline inflation for May at 2.8%. That compares with April's 2.7% increase in consumer prices from the prior year. The slight rise in headline CPI is partly due to higher petrol and water prices, Ling said.

Core inflation is forecast to keep moderating gradually over the year, cooling more discernibly in the fourth quarter, the Monetary Authority of Singapore and the Ministry of Trade & Industry said in a statement in May.

(All references to days are in local times.)

- Additional reporting by Ronnie Harui, Fabiana Negrin Ochoa, Amanda Lee, Kimberley Kao, Paul Vieira, Miriam Mukuru and Emese Bartha

Write to: Jessica Fleetham at jessica.fleetham@wsj.com and Hoi Shan Chan at hoishan.chan@wsj.com

(END) Dow Jones Newswires

June 21, 2024 10:25 ET (14:25 GMT)

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