KRW & THB Rally Strongly, CNH Lags Softer Dollar Backdrop

Asian FX has spent most of Thursday trade to date on the front foot, albeit to varying degrees. CNH has lagged, while KRW and THB have outperformed. A softer USD against most the of majors, particularly the yen, is helping sentiment, while US yields have also ticked lower as Fed easing gets priced back in. Equity sentiment is positive for the region as well. Still to come is the BSP decision, although no change is expected. Tomorrow focus will be China house price figures and April activity data.

• USD/CNH got to fresh lows of 7.2042 earlier, but we now sit back around 7.2140, only slightly firmer in yuan terms for the session. The USD/CNY fixing was only set marginally lower and remained above 7.1000. In the equity space, focus remains on strong real estate index gains, which have surged today around 13% today. This follows yesterday's new around the proposal for local governments buy unsold Chinese homes from distressed builders Overall, the yuan remains a low beta play to broader USD shifts.
• 1 month USD/KRW is tracking at fresh lows for May, last near 1343/44. This is +0.60% stronger in won terms for the session so far. Onshore markets have returned today, with equity markets rising, the Kospi last +0.85%, which is off earlier gains.
• 1 month USD/TWD is under 32.00 in the first part of trade, fresh lows back to the first half of April. The equity backdrop is positive (Taiex +0.7%), while offshore inflows continue. Spot TWD is back to 32.10.
• 1 month USD/IDR got under 15900 in early dealings, but we last racked around 15950, so slightly up on end NY levels from Wednesday's session (near 15930).
• USD/THB is around 36.05/10, +1.25% firmer in baht terms. We sit very close to session lows. This is back to late March levels for the pair. Local focus today will rest with the meeting between the finance minister and BoT Governor to discuss economic issues.
• Spot USD/PHP tracks lower at 57.25/30. The 1 month NDF is back to 57.30, so only slightly firmer in PHP terms for the session so far. The BSP meeting later is expected to deliver no change in the policy rate.