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ASIA FX: Mixed SEA FX Trends, Ringgit Seen Undervalued

ASIA FX
BulletEM BulletAPACEmerging Market News

South East Asia FX trends are mixed, although most USD/Asia pairs sit off earlier highs, consistent with a slight dip in US Tsy yields (off around 2bps for the benchmarks). Upticks in USD/MYR and USD/PHP have been faded, likewise for USD/IDR, while USD/THB holds higher.

  • USD/MYR is back sub 4.5000, the pair continuing to draw selling interest above 4.5150. The economic minister stated ringgit is undervalued and should be in the 4.10-4.15 range against the USD. Earlier there were positive comments around the growth outlook for 2025, while the final stage of the petrol subsidy has also been reached (per BBG).
  • USD/IDR got to highs of 16258 before selling interest emerged, the pair last at 16220, still 0.15% weaker in IDR terms. Resistance is likely to be evident on moves towards late 2024 highs around 16300. Headlines crossed late yesterday that the government is planning on requiring exporters to keep part of their earnings onshore for a year (up from the current period of 3 months). This move would be aimed at improving the IDR's defense in light of further USD gains this year.
  • USD/PHP is back to 58.35/40, off earlier highs above 58.60. The trade figures saw a narrower than forecast for Nov, although lower US yields and a firmer yen have arguably helped PHP more. The pair remains within recent ranges.  
  • USD/THB has risen to 34.705, fresh highs for 2025, but sits slightly lower latest dealings. Local bond investors see 50bps of BoT cuts this year, starting in Q2. 
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South East Asia FX trends are mixed, although most USD/Asia pairs sit off earlier highs, consistent with a slight dip in US Tsy yields (off around 2bps for the benchmarks). Upticks in USD/MYR and USD/PHP have been faded, likewise for USD/IDR, while USD/THB holds higher.

  • USD/MYR is back sub 4.5000, the pair continuing to draw selling interest above 4.5150. The economic minister stated ringgit is undervalued and should be in the 4.10-4.15 range against the USD. Earlier there were positive comments around the growth outlook for 2025, while the final stage of the petrol subsidy has also been reached (per BBG).
  • USD/IDR got to highs of 16258 before selling interest emerged, the pair last at 16220, still 0.15% weaker in IDR terms. Resistance is likely to be evident on moves towards late 2024 highs around 16300. Headlines crossed late yesterday that the government is planning on requiring exporters to keep part of their earnings onshore for a year (up from the current period of 3 months). This move would be aimed at improving the IDR's defense in light of further USD gains this year.
  • USD/PHP is back to 58.35/40, off earlier highs above 58.60. The trade figures saw a narrower than forecast for Nov, although lower US yields and a firmer yen have arguably helped PHP more. The pair remains within recent ranges.  
  • USD/THB has risen to 34.705, fresh highs for 2025, but sits slightly lower latest dealings. Local bond investors see 50bps of BoT cuts this year, starting in Q2.