Commodity Related FX Outperform

USD/Asia pairs are mostly lower, led by the commodity related currencies. In North East Asia, gains have generally lagged those seen elsewhere in the region. USD/CNH is back to unchanged, above the 6.8800 level. Tomorrow, we have South Korea consumer sentiment out, along with the BoT decision, with +25bps expected.

• USD/CNH was softer in early trade, in line with broad USD weakness, but couldn't sustain moves sub 6.8800. We sit back above this level now, unchanged for the session. This compares with a ~0.30% drop in the BBDXY index. China equities are underperforming more positive trends elsewhere in the region. Northbound stock connect flows are evident for the third straight session. They are modest overall though.
• 1 month USD/KRW hasn't been able to break back below the 1290 level, despite a firmer equity backdrop. Offshore investors have remained sellers of local equities today, with a further -$135.5mn in outflows (now -$438.8mn since the start of the week). 1 month USD/KRW was last back close to 1296.
• Spot USD/TWD sits just above session lows, last around 30.35. This is close to lows going back to late Feb, while the 200-day EMA sits slightly higher at 30.37. The simple 50-day MA is just above that at 30.38. There isn't much in the way of downside levels between here and the 30.00 handle. Today's modest TWD gains also come despite some weakness in local equities, with the Taiex off by around 0.8% at this point. This is line with weakness in the SOX through Monday's session, as core yields rebounded.
• USD/IDR is back sub the 15100 level (last 15090), around +0.45% firmer in IDR terms for the session so far. We are up slightly from session lows, but this puts the pair back to levels last seen in early Feb. The better equity tone, coupled with lower CDS levels will be driving improving risk appetite towards the IDR, particularly with light domestic news flows. 5yr CDS is back to 110, versus recent highs near 125.
• MYR is the best performer in the USD/Asia space. USD is pressured today as US Treasury Yields tick lower, firmer commodities have aided the MYR at the margins. Higher oil and palm oil prices since the start of this week have helped ringgit outperformance. Palm oil is up over 5%, although remains below the 200-day MA (MYR4114, versus current levels of MYR3974). From a technical perspective USD/MYR has ticked away from the 200-Day EMA (4.43) as it continues the recent downward momentum.