IDR & PHP Fortunes Diverge

USD/Asia pairs are mixed, with much of the focus on South East Asia FX today. IDR has continued to recover, up more than 1.2% for the session. USD/PHP has rebounded though. USD/CNH made fresh lows before recovering. Still to come is Indian inflation data, while tomorrow the focus is on the BoK decision (+25bps expected) and China trade figures.

• USD/CNH hit a fresh low of 6.7545, but rebounded and spent much of the rest of the session between 6.76/6.77. Onshore spot is still weaker though, currently tracking at 6.7550. Inflation data hinted the worst of the downtrend in price momentum is now behind us. The CNY fixing was close to neutral.
• USD/KRW has tracked familiar ranges, lasty near 1245, unable to sustain early momentum sub 1240. The authorities will expand onshore FX trading form the second half of next year, with measures to be unveiled in February. This remains part of the Korean authorities attempts to gain inclusion into global bond indices.
• USD/SGD is dealing just off an 18th month low as the pair dealt at its lowest level since June 2021 on Monday, before moderating gains. We last sat just above 1.3300. The pair is consolidating ahead of tonight's US CPI print. The bearish technical trend continues to hold, after a brief test of the 20-day EMA early in the week. Much may depend on broader USD sentiment in terms of future USD/SGD direction, as the NEER hasn't made fresh highs (based off the Goldman Sachs index) since early November.
• IDR has continued to play catch up today. USD/IDR spot is down a further 1.2%, comfortably outperforming the rest of the USD/Asia bloc. This puts us back under 15300, which is fresh multi-month lows. It also puts us below the 100-day EMA (15413) for the first time since August last year. Reports from yesterday that the authorities will require more export earnings to be kept onshore continues to aid the rupiah. The scheme will be expanded from the mining/agricultural sector to include manufacturing. The term may also be expanded from 3 months to up to a year.
• USD/PHP has rebounded, the pair back above 55.00, last near 55.25. Note the 200-day MA comes in at 55.35. Chatter from officials around stepping down the pace of tightening and when the easing cycle might commence have likely weighed. BSP Governor Medalla also stated FX pressures have reduced from a rate differential standpoint and that the market will determine spot levels.