EMERGING MARKETS-Indonesian rupiah hits record low as dollar rally and political turmoil weigh

By Nichiket Sunil and Roshan Thomas

Nov 12 (Reuters) - The Indonesian rupiah slid to a record low on Thursday, as the US dollar firmed on rising bets of a Federal Reserve rate hike next month and domestic political uncertainty deepened after Vice President Gibran Rakabuming Raka resigned.

The central bank intervened in the foreign exchange market to support the rupiah , which has fallen more than 8.5% this year, making it the worst-performing major currency in Asia.

On Thursday, the rupiah dropped to an all-time low of 18,248 after shedding nearly 1% over the previous two sessions, as the dollar climbed to a 19-month high following stronger-than-expected inflation data and hawkish remarks from Fed officials.

Pressure on the currency was compounded by domestic political uncertainty as Gibran's departure could complicate policymaking for an administration already under scrutiny over flagship programmes, including its free school meals initiative, and broader concerns about economic management.

The rupiah has also come under pressure after MSCI threatened to downgrade the country's emerging-market status over transparency and coordinated-trading concerns.

Overnight, the index provider removed Barito Pacific BRPT.JK from its global standard index, a move expected to trigger selling by passive funds that track the benchmark.

"It's clear that the rupiah faces a double squeeze: higher US yields erode its carry appeal, while political uncertainty raises the premium investors demand to hold Indonesian assets," said Glenn Yin, director of research at ACCM.

Attention now turns to next week's Bank Indonesia meeting, with markets widely pricing in another rate increase.

Other currencies in the region fell against the dollar. The Philippine peso fell 0.6% to 63.639 per dollar, giving back some of last week's gains driven by expectations that US midterm election results could support prospects for a peace deal and lower oil prices.

The Malaysian ringgit weakened to 4.0820 a dollar, its lowest since late October, while the Thai baht dropped to a more than one-week low of 33.7725.

Regional stock markets were mixed, with Indonesia .JKSE rising 1.3% to its highest since late October, while the Philippines .PSI and Malaysia .KLSE fell 1.1% and 0.6%, respectively.

Elsewhere, technology-heavy Taiwan .TWII and South Korea .KS11 reversed earlier gains to fall more than 1% and 0.2%, respectively, as investors reacted to a leadership crisis at Nvidia NVDA.O.

The growing turmoil at Nvidia risks undermining confidence in the AI trade that has fuelled much of this year's rally in global equities.

HIGHLIGHTS:

** Indonesian 10-year benchmark yields at 7.551%

** Nvidia board meets to decide CEO Huang's future as leadership crisis deepens