CNH Supported Via CNY Fixing Ahead Of Golden Week Holiday Period

USD/Asia pairs are mixed today. We have some markets out -South Korea, Indonesia and Malaysia. Today is also the final session ahead of the Golden Holiday week period for China, with onshore markets closed tomorrow and all of next week. USD/CNH has moved off recent highs, but remains well within recent ranges. THB has hit fresh YTD lows, while USD/PHP remains sub 57.00. Spot USD/HKD has firmed back to mid September levels.

• USD/CNH has tracked modestly lower, aiding by a stronger than expected CNY fixing. We were last near 7.3100, around 0.20% strong in CNH terms versus opening levels. Equity sentiment has been weaker, and note this is the final onshore trading session ahead of the Golden Week Holiday period, which kicks off tomorrow and runs through all of next week.
• Spot USD/HKD has firmed, the pair rallying to 7.8280 this afternoon. We were around 7.8210 at the open. This is fresh highs back to mid September. We have moved back above the 20-EMA (~7.8260), but the 200-day sits above 7.8300, which hasn't been breached yet. These moves come despite a fresh record high in overnight Hibor, fixing at 5.81%. The 1 month also climbed 4bps to 5.40%, highs back to earlier August. We were steadier in the 3 month space, fixing at 5.27%. This has kept the US-HK 3mth differential steady at +18bps.
• USD/MYR continued to tick higher yesterday, breaching the 4.70 handle, as broader USD trends dominated flows. The pair rose ~0.4% closing at its highest level since mid-November. A reminder that domestic markets are closed today for the observance of a national holiday. Palm Oil futures had their largest rise in 6 weeks yesterday, the weaker MYR is boosting demand and cushioning the impact of the recent slide in Soybean Oil.
• The SGD NEER (per Goldman Sachs estimates) sits a touch off Monday's cycle highs, holding a narrow range this morning. We now sit ~0.5% below the top of the band. Broader USD trends continue to dominate flows for USD/SGD, the pair printed a fresh cycle high as the USD continued to strengthen alongside US Tsy Yields yesterday. The pair is down ~0.1% this morning, last printing at $1.3710/15. Singapore will raise the price of water by 18% over two years from April, Consumers will have to pay an additional S$0.50 per cubic metre of water, which means most households will see an increase of less than S$10 in their monthly water bills once the full price revision takes effect, the national water agency PUB said in a statement Wednesday.
• USD/INR has opened dealing little changed from Wednesday's closing levels, the pair last prints at 83.23/24. Yesterday the pair consolidated recent gains above the 83 handle. Rising US Tsy Yields and Oil prices continue to weigh on the Rupee. FTSE Russell is to review India’s potential inclusion in its emerging market debt index on Sept 28; India is currently on watchlist for potential inclusion with the decision due late US hours today.
• USD/PHP continues to hold close to the 57.00 level. We got to a high of 56.985 in the first part of trade today, but sit slightly lower now (last 56.94). Focus remains on BSP intervention around the 57.00 level. A clean break above this resistance point would pave the way for a move towards 57.15, then 57.55, levels which prevailed back in Nov 2022. Upside pressure remains in USD/PHP, particularly from resurgent oil prices.
• USD/THB has continued to climb in the first part of trade today. We sit close to session highs, last at 36.75, -0.6% weaker in baht terms since the open. This continues the recent run of baht weakness, with some catch up to USD strength post the onshore close yesterday also in play. There doesn't seem much in the way of resistance to the 37.00 figure level. Ther 14 day RSI is overbought territory but has been for a number of sessions. The 20-day EMA sits back near 35.91. Yesterday's BoT hike only provided fleeting support to the baht, as broader USD trends continue to dominate. A number of sell-side analysts see the BoT on hold for the remainder of the year.