ASIA FX: CNH & KRW Rally, But Lag Some SEA Currency Gains

North Asian currencies have rallied against the USD so far today, buoyed by softer USD trends elsewhere (particularly in terms of the yen, +1% firmer). Lower US yields have helped, with Vice President Harris deemed to be the winner of the earlier Presidential debate. This has helped offset a generally weaker equity tone throughout the region. South East Asian (SEA) currencies have generally rallied by more though, given greater sensitivity to US yield shifts. 

• USD/CNH sits around 7.1120 in latest dealings, close to session lows. We are around 0.30% firmer in CNH terms, although lows from Friday last week at 7.0735 are still some distance away. CNH is benefiting from yen gains, although its beta with respect to such moves is fairly modest. CNH/JPY has broken lower to 19.82, levels last seen in January of this year. Earlier the USD/CNY Fixing was set below market expectations. Increased Harris odds of winning the Presidency should allay some fears of a further sharp escalation in trade tensions.
• Spot USD/KRW is back sub 1339, around 0.40% stronger in KRW terms. Yen and CNH gains likely aiding the won, although we remain well within recent ranges. On the data front, South Korean unemployment fell to 2.6%, a record low, against a 2.6% market estimate. Jobs growth slowed in y/y terms.  Other data showed Bank Lending to Households for mortgage loans have increased by a record in August. A likely concerns for the authorities.
• Spot USD/TWD is only down a touch, last near 32.15. This leaves us close to recent highs around the 32.20 level. Local equities are around flat at this stage, but offshore investors have continued to sell local equities.