Lower USD/Asia Levels Short Lived

Lower USD/Asia levels early in the session proved to be short-lived. Risk off took hold after reports that Japan's ex-PM Abe had been shot hit the wires. Lower US equity futures have weighed, while China equities are only modestly higher despite stimulus hopes. USD/CNH is back above 6.7000, likewise for USD/KRW above 1300. USD/THB's dip sub 36.00 also didn't last.

• CNH: USD/CNH has drifted higher, about +0.20% above NY closing levels. We are seeing selling interest closer to 6.7100 though, last at 6.7055/60. The CNY fixing was slightly weaker than expected, while China equities have only recorded modest gains, despite fresh stimulus hopes. Tomorrow, June inflation data is due.
• KRW: USD/KRW attempted to break sub 1296, but this proved to be short-lived. The pair is back above 1301 on broader risk aversion, as JPY rallied on news ex-PM Abe had been shot. The Kospi is holding up reasonably well (+1.00%), while offshore investors have added just under $90mn in local equities.
• INR: USD/INR is up modestly to 79.24, well up from yesterday's sub 79.00 lows, as analysts state it will take time for the RBI's measure to encourage capital inflows (announced on Wednesday) to aid the rupee. Brent crude is also firmer.
• THB: USD/THB has had a volatile session. Spot USD/THB last -0.057 at THB36.088, back from session low of THB35.890. Familiar technical levels remain in play. Thailand's central bank signalled that it would only intervene in FX markets to curb excessive volatility, adding that the baht's slump to six-year lows has reflected fundamentals. The BoT also played down the need to raise interest rates in line with the Fed.
• IDR: USD/IDR dipped in early trade but has edged higher. The 1 month NDF is back above 15000, while spot is at 14984, versus earlier lows of 14973. Consumer confidence eased back to 128.2 from 128.9 according to the BI measure for June.
• PHP: Spot USD/PHP had a look above PHP56.000 Thursday for the first time since 2005 as another round figure surrendered to the rallying pair. We are slightly lower today, last at 51.915, while momentum watchers should take note of the fact that the RSI for spot USD/PHP has remained in overbought territory for almost a month now. BSP Governor Medalla upped the ante ahead of next month's monetary policy meeting, suggesting that members are ready to consider an outsized half-point rate hike.