EMERGING MARKETS-Indian rupee hits 5-1/2-month low on c.bank decision, stocks climb

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    * Indian stocks up as much as 0.9%, hit 1-1/2-week high
    * Broader Asian equities track global rally
    * China shares gain after return from week-long holiday

    By Harish Sridharan
    Oct 8 (Businesshala) - The Indian rupee hit its lowest in
five-and-a-half months on Friday, while stocks firmed, after its
central bank left key rates unchanged and reiterated the need to
unwind pandemic-era stimulus only gradually to aid a nascent
economic recovery.
    Other emerging market stocks in Asia benefited from a rise
in global risk appetite as Washington approved a legislation to
temporarily raise the debt limit and avert a default.

    The Reserve Bank of India (RBI) kept interest rates steady
at a record low, as expected, and said accommodative monetary
policy was needed due to an uneven economic recovery from
pandemic-related shutdowns.
    The RBI's dovishness dashed expectations of investors hoping
it would hint at moving towards policy normalisation like some
global central banks, with the rupee shedding 0.4% to
hit its lowest since late-April. 
    The currency is also under pressure due to spiking crude
prices, having declined nearly 2% over the past two weeks.
    Any further liquidity measures over the coming RBI meetings
would probably still only amount to marginal policy tweaks, said
Darren Aw, Asia economist at Capital Economics.
    "We doubt that rate hikes will come onto the agenda until
the second half of next year when the economy should be closer
to full health," Aw added.
    Regional currencies weakened as benchmark U.S Treasury
yields firmed to their highest since June ahead of a key jobs
report in the United States, with the Thai baht and
South Korean won falling 0.2% and 0.4%, respectively.
    Jakarta shares rose 0.9% to their highest since
January, as investors cheered the new tax overhaul law approved
on Thursday, expected to boost next year's tax revenue by around
139.3 trillion rupiah ($9.79 billion).
    Meanwhile, stocks in Manila reversed early gains to
hit a more than one-week low, while Malaysia, Thailand
 and Singapore edged higher. 
    Chinese equities rose 0.7% on their return from a
week-long hiatus, helped by encouraging service sector data and
easing political tensions with the United States.
    Still, the focus remains on the property sector as investors
wait to see if regulators take action to contain the contagion
from cash-strapped Evergrande's debt crisis.
    
    HIGHLIGHTS
    
    ** Indonesian 10-year benchmark yields up 2.6 basis points
at 6.353%​​
    ** Wipro Ltd was the top gainer on India's Nifty
50
    ** Top gainers on the Jakarta stock index was Nusa
Konstruksi Enjiniring Tbk PT, up 31.07%
    
    
  Asia stock indexes and currencies at 0729 GMT
 COUNTRY      FX RIC           FX  FX YTD    INDEX  STOCKS  STOCKS
                          DAILY %       %            DAILY   YTD %
                                                         %  
 Japan                      -0.33   -7.79             1.34    2.20
 China                      -0.01   +1.24             0.67    3.43
 India                      -0.35   -2.63             0.55   27.94
 Indonesia                  -0.13   -1.36             0.86    8.24
 Malaysia                   +0.07   -3.80             0.16   -3.90
 Philippines                -0.14   -5.06            -0.64   -3.26
 S.Korea                    -0.35   -9.07            -0.11    2.88
 Singapore                  -0.03   -2.77             0.26    9.33
 Taiwan                     -0.25   +1.65            -0.44   12.95
 Thailand                   -0.24  -11.52             0.40   13.17
 
($1 = 14,231.0000 rupiah)

    
 (Reporting by Harish Sridharan in Bengaluru; editing by
Uttaresh.V)
  
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