(Bloomberg) -- Asian emerging economies, particularly those in Southeast Asia, are in a stronger position financially than their global peers to weather risks from rising U.S. interest rates.

Four of the top eight economies on a vulnerability index by Thailand’s Bank of Ayudhya Pcl are from Southeast Asia, with only Indonesia falling lower down on the scale, according to a July 20 research note.

Taiwan and Thailand take the top two slots in terms of financial health, with Turkey, Argentina and Venezuela rounding out the bottom of the index. Indonesia was No. 16.

The Bank of Ayudhya’s index of 24 emerging nations gives equal weights to four indicators: current-account balance, foreign reserves, external debt and inflation.

Thailand’s transition to a floating exchange rate regime since the Asian financial crisis two decades ago and greater trade with the rest of the world have put the economy in a stronger position, with “hefty” current-account surpluses in almost every year since then helping to boost foreign reserves, the bank said.

Many central banks in the region have started raising interest rates this year as the Fed tightened policy, including Malaysia, the Philippines and India.

Thai policy makers may also follow later this year with a 25 basis-point hike in the fourth quarter, the Bank of Ayudhya said. An interest-rate adjustment is the most appropriate policy response, compared with other measures such as capital controls and macro-prudential measures, the authors of the report said.

“An early start to policy normalization would signal the Bank of Thailand’s confidence in Thailand’s economic and inflation prospects” while also aiming to stem outflows and stabilize the baht, they said.

--With assistance from Suttinee Yuvejwattana.

To contact the reporter on this story: Michelle Jamrisko in Singapore at mjamrisko@bloomberg.net

To contact the editors responsible for this story: Nasreen Seria at nseria@bloomberg.net, Karl Lester M. Yap

©2018 Bloomberg L.P.