Asia FX Underperforms Higher Beta G10 Trends

Asian FX hasn't seen much positive spill over from the stronger higher beta G10 FX tone (AUD, NZD & NOK) against the USD through today's session. Spot markets sit mostly higher in USD/Asia terms versus yesterday's closing levels. Cross asset signals have been mixed, although China/HK equities have firmed. Tomorrow the focus is on China CPI and PPI prints for Jan. Malaysian Q4 GDP prints, as does Indian IP.

• USD/CNH found selling interest above 6.8000, and last tracked near 6.7900, little changed for the session. Local equities are doing better, with Northbound flows returning for the first time in 5 days. A report from a prominent China economist that policy rates could be cut in Q2 has aided such sentiment. There may be less follow through on the FX side though.
• 1 month USD/KRW found selling interest close to 1265 in early trade. We last track near 1261, still above NY closing levels from Wednesday. Equity losses have been curbed during the session, with some spill over likely from China/HK moves.
• The SGD NEER (per Goldman Sachs estimates) is marginally firmer this morning, although it is below highs seen earlier this week. NEER sits ~0.7% below the upper end of the band at present levels. USD/SGD is little changed from yesterday's closing levels in today's dealing. The pair has traded in tight ranges in recent sessions as the broad based USD strength seen post the NFP print has faded. It last printed 1.3255/65
• USD/THB has tracked slightly higher in the first part of trade today. We are around 33.56 currently, +0.25% for the session. This leaves us within recent ranges for the pair. Signals from the equity space remain a headwind, with the SET off a further 0.50% today. The index is back close to its simple 50-day MA (1658.16). Yesterday, offshore investors sold a further $118.6mn of local equities, continuing the recent outflow trend. On the data front, consumer confidence for Jan rose to 51.7 from 49.7. This is highs back to late 2020. For the economic situation, confidence was at 46.0 versus 43.9 prior.
• Like elsewhere in the region, USD/IDR is fairly range bound today. Spot is slightly higher in USD/IDR terms, last around 15120/25 (+0.15% for the session). Support is still evident around the 15100 levels, whilst both the 20 (15109.6) and 200-day (15129.65) EMAs are nearby. We may stick to broad ranges ahead of next week's important US CPI release. In terms of cross asset drivers, the Citi terms of trade proxy continues to trend lower, while the 5yr CDS is up off recent lows, post the US non-farm payrolls report. Encouragingly for IDR bulls, flows have continued into Indonesian government bonds post the payrolls report, with a further $245.1mn so far this week.