Most EM Currencies Gain

Most EM currencies gained in a supportive risk environment.

• CNH: Offshore yuan gained as China reported a wider than expected trade surplus for the month of June, underpinned by considerable beats in both exports and imports. The PBOC fix came in 10 pips above sell-side estimate, provoking virtually no reaction.
• SGD: Singapore dollar is higher, yesterday the government eased restrictions on groups of people dining and plans to further reopen the economy when 50% of the population is vaccinated later this month.
• TWD: Taiwan dollar gained, USD/TWD retreating further from the 28.00 handle. On the vaccine front the government has plans to purchase 15 million doses of Moderna's vaccine in 2022 and another 15 million in 2023. There were reports yesterday that Foxconn and TSMC had reached deals to purchase 10 million doses of the BioNTech vaccine
• KRW: The won strengthened, there were some comments from Vice FinMin lee earlier who noted that volatility was rising in South Korean markets due to the latest wave of coronavirus, adding that the government would strengthen monitoring on markets and risk factors.
• MYR: Ringgit is stronger, FinMin Zafrul said that the gov't may lower its 2021 growth forecast to around +4.0% Y/Y from the current +6.0%-7.5%, adding that he would propose raising the legal debt ceiling to 65% of GDP from 60%, as fiscal deficit may prove wider than projected this year.
• IDR: Rupiah is flat, Indonesia declared another record-breaking increase in new Covid-19 infections, adding 40,427 new cases on Monday. The number of deaths rose by 891, amid shortages of oxygen and other critical supplies.
• PHP: Peso bucked the trend and declined, hitting the lowest in over a year. Fitch affirmed Philippines at BBB (second-lowest investment grade score), but revised its outlook to negative from stable, citing "increasing risks to the credit profile from the impact of the pandemic and its aftermath on policy-making as well as on economic and fiscal out-turns."
• THB: Baht is stronger, Thai cabinet may consider additional economic assistance measures for those affected by Covid-19 restrictions during its weekly meeting today.