Greenback Bounce Sees Most Asia FX Decline

The greenback rebounded which put pressure on most Asia EM FX, regional dynamics in the form of data and pandemic fears contributed to the extent of the decline.

• CNH: Offshore yuan is weaker, data showed that while indicators continued to grow, the pace of expansion slowed. The PBOC kept MLF rates unchanged and drained CNY 10bn from the system. The rate came off worst levels seen post data.
• SGD: Singapore dollar is lower, Singapore has announced tighter restrictions from May 16 to June 13. There were 38 new cases reported on Sunday, the highest in over a year.
• TWD: Taiwan dollar fell, over the weekend authorities announce the tightest restrictions of the pandemic after recording a record 206 virus cases on Sunday, it follows a soft lockdown already announced in Taipei.
• KRW: Won is lower, South Korea reported 619 daily new coronavirus cases, staying in the 600s for the third consecutive day Monday, as infections from private gatherings, schools and military bases continued amid little progress in vaccinations.
• MYR: Ringgit declined, the coronavirus situation continues to deteriorate. In some states, ICU occupancy rate hovers above 80%, while some hospitals have already used up all of their dedicated Covid-19 beds.
• IDR: Rupiah is lower. The gov't expressed concern about social mobility over the holiday period and its ramifications for the national fight against Covid-19. Transportation Min Sumadi said that more than 1.5mn people may have gone on traditional "mudik" trips, despite a mudik ban imposed between May 6-17.
• PHP: Peso is marginally stronger, Pres Duterte signed off on temporary cuts of rice duties, in a move devised to address supply-side drivers of inflation. He also approved an adjustment of earlier pork tariff cuts after striking a deal with Senators, who stepped in to protect domestic hog industry.
• THB: Baht is lower. Data showed GDP rose 0.2% Q/Q against expectations of 1% decline, the Y/Y reading fell 2.6% against expectations of a 3.3% fall. The 2021 GDP estimate range was revised to 1.5%-2.5%.