Reuters Southeast Asia News Highlights 0900 GMT Nov 4

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JAKARTA - Indonesia's central bank kept its benchmark overnight rate at a record low of 6.50 percent and said it expected inflation to come down towards levels enjoyed by its neighbours over the medium term.

Analysts, however, said the central bank may start to hike rates again in the first quarter in a bid to curb price pressure.

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HANOI - Tropical storm Mirinae killed 42 people after ploughing into central Vietnam this week, and several others are missing, state media reported.

Rain and wind from the storm delayed coffee harvesting in parts of the Central Highlands coffee belt, but residents there said on Tuesday things were returning to normal.

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MANILA - The Philippines may exceed its budget deficit goal this year of 250 billion pesos ($5.2 billion) due to spending related to typhoon reconstruction and despite successful sales of assets, the finance minister said.

Manila is looking to sell the 103-hectare Food Terminals Inc commercial estate it had valued at around $279 million and a 40 percent stake, worth about 11 billion pesos, in oil-and-gas explorer PNOC-Exploration Corp (PNOC-EC) before the year ends.

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BANGKOK - Police in Thailand said they had arrested a third person on suspicion of spreading rumours about the health of the country's 81-year-old king which triggered a slide in stock prices.

"We've arrested another man on this case," Police Major General Panya Mamen, a deputy chief at the Central Investigation Bureau, told Reuters.

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KUALA LUMPUR - Industrial and Commercial Bank of China, the country's biggest lender, will get a license to open in Malaysia when Chinese President Hu Jintao visits on Nov. 10-11 and a raft of commercial deals will be signed, the Straits Times newspaper reported.

Citing an unnamed senior Malaysian government official, the Singapore paper reported on Wednesday that ICBC would get an operating license and be allowed to open four branches.