Rate Hikes Spur Bets That Asian Central Banks Will Keep Going
- Steeper cycles seen after Korea, India, Philippines tightened
- DBS forecasts upward risks to Asian terminal rate projections
Shoppers at a market in New Delhi.
Photographer: Kanishka Sonthalia/BloombergThis article is for subscribers only.
Traders are rushing to price in a higher peak to the rate cycle in emerging Asian markets, as they anticipate that central banks will have to hike faster and more aggressively.
Central banks raising rates from India to Malaysia have spurred bets in swap markets, with traders raising terminal rate expectations in the South Asian nation by more than 75 basis points in recent weeks. Even countries in the region, like New Zealand, which have been ahead of others in policy normalization, are raising the peak rate forecasts.