Following The Majors Higher Against The USD

Most USD/Asia pairs are lower, shrugging off negative sentiment from regional equities. The USD is softer against the majors, amid lower US cash Tsy yields, which has helped Asian FX. Only IDR has been a laggard, along with TWD. Still to come is Thailand November trade figures, while tomorrow the South Korean CPI for December prints.

• USD/CNH has caught up with USD weakness to a degree. The pair is back to 6.9750, around -0.30% down for the session. The CNY fixing was close to neutral. Equity sentiment is weaker amid Covid concerns, but this isn't impacting FX sentiment a great deal into year-end. Selling interest is still evident on moves above 7.00.
• 1 month USD/KRW is testing through recent lows sub 1265. The pair last at 1262. IP figures were slightly better than expected, but chip production continues to fall. Onshore equities remain weak, the Kospi down 1.60%, while offshore investors remain net sellers of local equities. Tomorrow onshore markets are closed. They re-open on January 2.
• USD/IDR broke higher, the pair got above 15760, which is fresh highs back to early 2020, before selling interest emerged. We were last at 15710, with the authorities potentially on-guard against further weakness in thinner liquidity markets ahead of year end. Early April 2020 highs came in around the 15820 level and beyond that is the 16000 region.
• USD/PHP is back below 56.00, the pair last at 55.75. Earlier lows were at 55.685, while the simple 20-day MA comes in at 55.699, so this may have provided some support. Still, we are -0.70% lower for the pair compared to yesterday's closing levels. The BSP Governor stated GDP will likely grow much faster than the official 6.5-7.5% target, per Bloomberg reports. The BSP also expects December CPI to print between 7.8-8.6%, although the consensus already looks for an 8.3% outcome. This data is due early in January.