The Indonesian rupiah led gains among emerging Asian currencies on Tuesday and its stocks hit a record high, while investors focused on the Jackson Hole symposium later this week where the Fed could offer further hints on rate cuts.

The MSCI International Emerging Market Currency Index rose 0.2% to touch a fresh record high, while the Indonesian rupiah gained as much as 0.5% to trade at 15,470 per dollar, hitting its highest since early January.

“We view the Asian currency rebound as a recovery of the losses from the Fed’s ‘high for longer’ rates stance in the first half of this year,” senior FX Strategist Philip Wee from DBS wrote in a client note.

“There is scope for the South Korean won, Philippines peso and Indonesian rupiah to play catch up in recovering this year’s losses,” he added.

Other currencies such as the Malaysian ringgit, Taiwan dollar, Philippines peso and Thailand baht traded between flat and 0.4% higher.

Investors will close watch the Jackson Hole symposium later this week, where Fed Chair Jerome Powell is likely to acknowledge the possibility of a rate cut in the September meeting.

Such a move could boost riskier Asian assets and drive a weakening trend in the dollar, with inflation also easing in most emerging Asian economies.

Asian currencies: Indonesian rupiah leads gains

The dollar index, a measure of the greenback against six major currencies, drifted lower overnight to 101.95, although it stayed steady during Asian hours.

“(EM Asia) central banks have room to cut interest rates. However, they are not in a hurry as they are avoiding capital flow and exchange rate volatility and will likely only ease once US policy interest rates begin easing,” analysts from S&P Global Ratings said in a note.

Central banks in Thailand, Indonesia and South Korea are set meet this week, where all three are expected to stand pat on rates, contrasting with the Philippines’ central bank decision to slash its main policy rate last week.

Moreover, inflation prints from Singapore and Malaysia during the week are likely to set the tone for their respective central banks’ stances on rate cuts.

Elsewhere, China left its benchmark lending rates unchanged as expected.

The yuan traded flat while stocks fell almost 1%.

Among Asian shares, the Jakarta benchmark advanced as much as 0.9% to a record high, while Manila stocks climbed about 1.7%, nestled near their early April highs.

Others such as Singapore, Bangkok, Taipei and Seoul traded between 0.1% and 0.8% higher.