Mixed Picture

A mixed picture in Asia as South Korea strikes an upbeat tone while India struggles with further state lockdowns.

• INDIA: Yields mostly higher in early trade. Several states have extended existing lockdowns as the coronavirus situation continues to worsen, while New Delhi has announced additional restrictions. Yields rose on Friday after participants trimmed positions post auction, while contemplating the prospect of no central bank operations this week, instead looking ahead to SLTRO operations on May 17.
• SOUTH KOREA: Futures are lower in South Korea, dropping from the open as the won strengthened and equities rose. Coronavirus cases dropped below 500 while South Korean President Moon was upbeat on a number of subjects in his speech, emphasizing US cooperation and the domestic economic recovery as well as sounding positive on the battle against coronavirus.
• CHINA: The PBOC matched liquidity injections with maturities again, repo rates rose but the 7-day repo rate stayed below the 2.20% PBOC rate. Futures in China are higher, moving out of negative territory after gapping lower at the open as equity markets struggled to make decisive gains. There was some focus on an article from a PBOC official which said China needs to deepen reforms and make the financial sector more open and exchange rate market driven.
• INDONESIA: Yields lower across the curve as the rupiah hits the highest in two months, Bank Indonesia April consumer confidence index came in at 101.5, while Danareksa Consumer Confidence improved to 80.1 in Apr from 74.9 recorded in Mar.