KRW Rallies On +2.7% Equity Gain & $1bn In Net Equity Flows

USD/Asia pairs are all lower, bar USD/CNH, where volatility remains very muted. KRW and IDR, the higher beta plays, have been the standouts, but gains have been evident across the board. Better regional equity sentiment (ex China) and carry over from lower US yields on Thursday is driving the moves ahead of NFP later in the US. Coming up Monday we have more PMI prints, including the Caixin services in China, Thailand CPI and Indonesia Q4 GDP.

• USD/CNH has maintained tight ranges, the pair last near 7.1900, as volatility remains very low. Local equities have been volatile, but ultimately sit down comfortably down in the early part of afternoon trade. More support for housing and fresh gaming approvals not enough to push us into positive territory at this stage.
• 1 month USD/KRW sits near 1320 in recent dealings, fresh multi week lows back to mid Jan. The Kospi has surged over 2.7% amid a combination of better tech momentum led by the US and the recent comment from Finance Minister around resolving the "Korea Discount" clear positives. Offshore investors have added over $1bn to local equities so far today. Earlier we had slightly weaker than expected Jan inflation data.
• USD/IDR sits sharply lower in the early part of Friday dealing. Spot is under 15700, last near 15670, around 0.60% stronger in IDR terms. Broader risk moves are certainly helping IDR. The chart below plots spot against the US 10yr real yield. This week's correction lower has aided rupiah sentiment, with an eventual Fed easing cycle (even with push back this week on a March kick off) seen as a key IDR positive by the authorities as we progress through 2024.
• USD/PHP sits back sub 56.00 in the first part of Friday dealing (last at 55.90). We are back close to mid Jan levels and around 0.40% stronger in PHP terms so far today. PHP has benefited from the broader USD pull back, aided by lower US teal yields. The improved global equity, plus lower oil prices is another positive. Local equities are also pushing higher, the PCOMP threatening to break to fresh multi month highs (last near 6700). PHP has benefited from the recent turn higher, albeit with a lower beta to such moves in recent months. Offshore investors have added modestly to local shares this week.
• USD/THB sits near 35.30 in recent dealings, stronger by 0.40% in baht terms. We aren't too far away from late Jan lows in the pair at 35.27. The 200-day EMA sits slightly lower at 35.23, the simple 200 MA further south at 35.15. Note we get Jan CPI data on Monday, with headline forecast at -0.95% y/y (prior -0.83%), while core is projected steady around 0.60% y/y. The on Wednesday we get the BoT decision. No change is expected by the consensus at this stage (current policy rate at 2.50%).