Fresh Highs For USD/CNH, INR Outperforming Broader USD Gains

USD/Asia pairs are generally higher across the board today. Hong Kong markets have returned, with weaker equities weighing on CNH, with USD/CNH printing fresh cyclical highs above 7.2200. PHP has outperformed in SEA, but other pairs are higher, with USD/THB above its simple 200-day MA. Next Monday, China markets return. The data calendar has Singapore and Taiwan IP out then as well, while Thailand customs trade data may also print.

• USD/CNH got to a fresh high of 7.2286, but sits slightly lower now, last near 7.2230. Weaker HK and China Enterprise equity sentiment has certainly weighed, while China markets still being out may have impacted liquidity. Late Nov 2022 highs in the 7.25/7.26 region is the likely next upside target.
• Spot USD/KRW got above 1305, but sits slightly lower now under 1304. The risk off tone to regional markets is weighing on the won, along with higher USD/CNH levels. The 200-day EMA is at 1304.70. The tone of offshore selling of local equities has continued, with a further $164.1mn in outflows so far this session, bringing week to date outflows to $1.17bn.
• USD/THB is firmer in the first part of dealings today. The pair last near 35.23, which puts it above the simple 200-day MA (35.14). We haven't been above this resistance point since late Nov 2022. Baht is around 0.50% weaker so far for the session, with broader USD sentiment more positive amid a risk averse mood in markets. Local equities are a headwind for the baht, with the index back close to the 1500 level, which is not far off YTD lows. Equity outflows persist, with $123.8mn so far this week, while bond inflows are only very modest.
• USD/IDR has rebounded back towards 15000, although hasn't breached this level yet. BI reiterated its strategy around the FX yesterday at the monetary policy meeting, where rates were left on hold. Broader risks appetite is softer so. Earlier highs in the week for the pair came in around 15050.
• USD/INR is higher, but only marginally. The pair last near 82.00, leaving the rupee an outperformer during this latest USD run higher. Equity flows have been strong this week, with a further $670.90mn in inflows on Wednesday. President Biden and PM Modi announced a number of deals to boost economic and military cooperation as part of Modi's visit to the US.
• Spot USD/PHP has been relatively steady around 55.60, with BSP Governor Medalla stating the central bank has done enough on rates, but stating the best strategy is to wait (re rate cuts). He reiterated the Q1 window next year.
• USD/MYR is up to fresh highs for the year, last near 4.6750. Oil weakness and CNH losses have weighed on the ringgit. May CPI printed a touch below expectations (2.8% y/y, versus 3.0% forecast and 3.3% prior).
• USD/SGD is back towards 1.3500, amid broad USD gains. May CPI printed weaker for the headline, 5.1% y/y (5.4% forecast), but core was in line at 4.7%y/y.