Weaker CNH Spills Over To The Rest Of The Region

USD/Asia pairs are higher today. Taking their cue from a weaker CNH, which came after the unexpected MLF cut and weaker than expected July activity data. Most betas with respect to CNH moves have been lower than 1, except for THB, which has fallen by just over 0.8% as Q2 GDP came in below expectations.

• CNH: USD/CNH is up just over 0.5% at the time of writing versus the Friday NY close. This puts the pair back above 6.7700. A surprise MLF cut and weaker than expected China activity data are the main drivers of today's move. Recent highs in the 6.7700/6.7900 region could be tested in coming sessions.
• KRW: South Korean markets have been closed today, but the 1 month USD/KRW NDF has pushed higher in line with USD/CNH moves. We are now above 1305, which is +0.30% above NY closing levels from the end of last week.
• IDR: Spot USD/IDR has added 60 figs so far and last changes hands at IDR14,728. The rate has been creeping higher from the open but has struggled to break out of last Friday's range. Trade balance data was better than expected for July, with the surplus just above $4.2bn, versus the market estimate of $3.949bn.
• PHP: Spot USD/PHP trades +0.228 at PHP55.853 at typing, with bulls looking to a move through Jul 28 high of PHP55.975. This would open up historic highs at PHP56.500. Bears look for a dip through the 50-DMA, which intersects at PHP55.120. Global funds were net sellers of Philippine stocks last Friday, shedding a net $105.2mn in local equities in the largest outflow since May 24.
• THB: Spot USD/THB is noticeably higher today. The pair has surged nearly 0.80%, to be back close to 35.50. Disappointing Q2 GDP weighed. The outcome was weaker than expected at 0.7% QoQ versus 0.9% expected. Topside technical focus falls on Jul 21 cycle high of THB36.945. Conversely, bears look for a slide through Jun 29 low of THB34.960, followed by the 100-DMA at THB34.759.