Calm Ahead Of Fed Decision, Chinese Data Fail To Move Needle

Most USD/Asia crosses were happy to hug tight ranges as participants awaited the upcoming monetary policy decision from the Fed, while Chinese activity data failed to move the markets.

• CNH: Spot USD/CNH stabilised in negative territory after meandering in early trade. The yuan shrugged off the latest batch of data out of China, which was fairly underwhelming. The slowdown in retail sales growth was more pronounced than expected and the unemployment rate edged higher, even as industrial output was marginally firmer than forecast. China's new home prices fell for the third straight month in November amid the ongoing crisis engulfing the local property market. Elsewhere, the PBOC rolled over CNY500bn of MLF loans, which generated a net drain of CNY450bn, holding the rate applied to the operations steady.
• KRW: Spot USD/KRW crept higher as PM Kim announced that the government considers tightening social distancing measures, to be unveiled on Friday. The authorities could limit restaurant and cafe operating hours and lower caps on private gatherings as critical Covid cases continue to surge, putting a severe strain on medical capacity. The won was the worst performer in the region.
• IDR: Spot USD/IDR pared its initial gains through the session. Indonesia's trade surplus shrank in November, as imports picked up more than expected.
• MYR: Spot USD/MYR reversed its initial gains. Domestic headline flow was fairly limited.
• PHP: The Philippine peso reopened on a firmer footing, after the government raised their 2021 GDP growth forecast and projected narrowing budget deficits going forward.
• THB: Spot USD/THB traded sideways. The World Bank said they expect Thai economic activity to return to pre-Covid levels by end-2022.