Mixed Backdrop

The greenback higher after sliding on Friday, bonds and equities both higher providing a mixed backdrop for EM FX. Some currencies given a boost after the US Tsy decided to refrain from naming any trading partners currency manipulators.

• CNH: Yuan is slightly weaker, moving higher as a function of the greenback in an uneventful session, Markets look ahead to the LPR announcement tomorrow, while money market rates rose.
• SGD: Singapore dollar is stronger, still benefitting from less dovish MAS and robust GDP figures, while data on Friday showed strong exports.
• TWD: Taiwan dollar is higher, strengthening after the US Tsy refrained from labelling Taiwan a currency manipulator. The report did say the central bank should let TWD strengthen and refrain from intervention.
• KRW: The won is slightly weaker in a quiet session. New COVID-19 cases drop below 600 while markets continue to digest an upbeat economic assessment for the BoK last week which has helped stem downside.
• MYR: Ringgit is weaker. Health Min Adham said that the decision on the closure of schools will be made based on the assessment of the district health office, Education Ministry (MOE) and the state government.
• IDR: Rupiah is flat, essentially treading water ahead of the BI later this week. The Business Times circulated an interview with FinMin Indrawati, who said that Indonesia's GDP growth can return to pre-pandemic levels as more people become inoculated against Covid-19. She said that the gov't remains optimistic and expects a 4.5-5.3% Y/Y growth this year.
• PHP: Peso is weaker, top defence officials denied rumours that a group of active and former military officers withdrew support for Pres Duterte over his policies on China's actions in the South China Sea.
• THB: Baht is flat, Thailand set a new daily record in Covid-19 cases on Sunday, recording 1,767 infections, with the local press warning against the risk of hospital bed shortage.