Weighed By Lower EUR & Equity Weakness

USD/Asia pairs are higher today across the board, as lower EUR levels and weaker equity market sentiment continues to weigh. We are seeing fresh cyclical highs/record highs in a number of pairs.

• CNH: USD/CNH is above 6.7500, +1% above lows from late last week. Equity weakness, driven by fresh covid concerns, continues to outweigh better data momentum. The CNY fix was also weaker than expected. USD/CNH is playing catch up to broader USD strength, as EUR flirts with a break below parity against the USD.
• KRW: USD/KRW spot has reached fresh cyclical highs above 1315, around +0.85% above yesterday's closing levels. The Kospi is down by 1.4%, while offshore investors have stepped up the pace of selling of local equities.
• INR: Rupee continues to weaken, with USD/INR rising above 79.60, a further +0.25% on yesterday's closing level. The RBI's announcement of trade being settled in rupee hasn't had a huge impact on sentiment. The move is largely seen as facilitating Indian buying of Russian oil.
• IDR: Spot USD/IDR has added 21 figs so far and last deals at IDR14,994, a modest +0.15% rise on yesterday's levels. IDR is outperforming the broader trend for Asian FX. Indonesia's 5-Year CDS premium, one of the indicators of rupiah vulnerability watched by Bank Indonesia, has soared to levels last seen in June 2020.
• MYR: USD/MYR is at fresh cyclical highs, last trading at 4.4373. We have seen some catch up today with broader USD strength following yesterday's public holiday. FinMin Zafrul was positive about the nation's potential to meet its 2022 economic growth target. He suggested that GDP may rise +5.3%-6.3% Y/Y this year amid continued strengthening in domestic demand. g the recent upsurge in COVID-19 cases and urged high-risk individuals to get booster jabs.
• THB: Baht is revisiting cyclical lows. USD/THB is up 0.5% today, last at 36.36. Topside technical focus falls on Oct 2, 2015 high of THB36.665. Conversely, a dip through yesterday's low of THB35.882 would bring Jun 29 low of THB34.960 into play.
• PHP: The Philippines' monthly trade deficit unexpectedly widened to $5.679bn in May from $5.349bn recorded in April. The latest reading marks the largest shortfall on record, underscoring the gravity of the "twin deficit" challenge faced by the new administration from day one. Spot USD/PHP now trades +0.370 at PHP56.363, which brings the all-time high printed in 2004 at PHP56.500 into view.