EMERGING MARKETS-Asian stocks climb as strong China PMI boosts sentiment

* Philippine peso, Thai baht lead gains * China's Caixin PMI rose to 51.6 in Feb, beating expectations * Markets in South Korea closed for a public holiday By Upasana Singh March 1 (Reuters) - Most stock markets in emerging Asia rose on Wednesday after strong manufacturing activity data from China lifted sentiment, while investors continued to assess the likelihood of further interest rate hikes by the U.S. Federal Reserve. Equities in Manila climbed 1% to lead gains. Singapore's benchmark index and Jakarta shares advanced 0.3% and 0.2%, respectively. Currencies in the region were mostly muted, with Malaysia's ringgit and Indonesia's rupiah trading flat. The Singapore dollar was up 0.1%. The Philippine peso rose 0.6%, while the Thai baht appreciated 0.4%. Annual inflation in the Philippines was likely within a range of 8.5% to 9.3% in February, the country's central bank said on Tuesday, adding that it would continue to adjust its monetary policy stance as necessary to prevent the further broadening of price pressures. Data showed China's non-manufacturing activity grew at a faster pace in February, while factory activity rose for the first time in seven months as the country shook off its strict COVID curbs. "For now, the market is reminded that China's recovery is showing no signs of faltering," said Eugenia Victorino, head of Asia strategy at Skandinaviska Enskilda Banken. The yuan firmed 0.3%. Equities in Shanghai advanced 0.9%. "The data will provide some relief to global risk sentiment, but it will be difficult to counteract the intensification of negative sentiment amid higher for longer Fed rate expectations," said Mitul Kotecha, head of EM Strategy at TD Securities. A slew of upbeat U.S. economic data in recent weeks has heightened expectations that the Fed would hike rates to a higher level than market forecasts and keep them elevated for longer than was initially expected. Fed fund futures suggest rates peaking at around 5.4% by September, with a chance of a 50 basis point hike in March. "U.S. non-farm payrolls and CPI (consumer price index) reads will be important to gauge the strength of U.S. demand, which could lead to USD/Asia resuming its appreciation path," said Wei Liang Chang, macro strategist at DBS Bank. HIGHLIGHTS: ** The Philippine government posted a budget deficit of 1.6 trillion pesos for 2022 ** India's economic growth slowed further in the December quarter as pent up demand eased and weakness in the manufacturing sector continued ** Taiwan's defence ministry said it had spotted 19 Chinese air force planes in its air defence zone in the past 24 hours, part of what Taipei calls regular harassment by Beijing The following table shows rates for Asian currencies against the dollar at 0343 GMT. COUNTRY FX RIC FX FX INDE STOCKS STOCKS DAILY % YTD % X DAILY YTD % % Japan -0.10 -3.83 <.N2 0.01 5.18 25> China EC> India +0.36 +0.43 <.NS 0.00 -4.43 EI> Indonesi -0.03 +2.07 <.JK 0.21 0.10 a SE> Malaysia +0.04 -1.85 <.KL -0.32 -3.08 SE> Philippi +0.55 +1.18 <.PS 0.95 0.80 nes I> Singapor +0.11 -0.50 <.ST 0.26 0.61 e I> Taiwan -0.44 +0.30 <.TW 0.33 10.02 II> Thailand +0.43 -1.34 <.SE 0.22 -2.56 TI> (Reporting by Upasana Singh in Bengaluru)