Mixed Session Ahead Of US CPI Print

Asian FX has been mixed, CNH, TWD and KRW all weighed down by softer equities. The won has been the weakest performer though, with USD/KRW back to 1310. THB has reversed earlier gains, while INR has found a firmer base after markets re-opened today.

• CNH: USD/CNH has drifted higher today, but is still only +0.10% higher versus NY closing levels. We currently track just above 6.7610. The CNY fixing was slightly weaker, while inflation metrics printed weaker than expected. Headline CPI still accelerated, but was mainly driven by food. Core inflation eased back to April 2021 lows. China equities faltered, in line with the regional trend.
• KRW: USD/KRW is pushing higher amidst equity weakness. The Kospi is off 0.8% so far, following poor tech leads overnight, which raised questions over the chip/tech outlook. 1 month USD/KRW is back above 1310.
• TWD: It has been a similar story for Taiwan related assets, with the Taiex down by 0.60% so far in the session. USD/TWD is very quiet though, spot back above 30.00 but the 1 month NDF has edged lower. The Taiwan Affairs Office of China's State Council released a white paper titled "The Taiwan Question and China's Reunification in the New Era." See this link for more details.
• INR: Spot USD/INR is a little lower after markets re-opened today. Spot is last at 79.43, around -0.30% versus closing levels on Monday. There doesn't appear to be much impact on sentiment after the ruling BJP loss power in Bihar (see this link).
• THB: USD/THB opened lower but found support around the 35.30 level. We last tracked just above 35.44. Optimism about the outlook for the local tourism industry continues to filter through, although today's BoT decision will be in focus. We expect the Bank of Thailand to raise its benchmark interest rate by 25bp today (click here to see our preview).
• PHP: USD/PHP has continued to push higher, spot up is a further +0.20% to 51.72. The PSEi has weakened, last sits ~0.55% lower on the day. Foreign players were net sellers of $101.5mn in local equities yesterday, which was the largest outflow since late May.