Most USD/Asia Pairs Higher As USD/CNH Rebounds

Most USD/Asia pairs have seen a modest drift higher, led by a rebound in USD/CNH. Weaker equities in parts of the region have also weighed, while the USD is modestly higher against the majors (ahead of the FOMC). THB has outperformed, while MYR has been steady in the face of the USD/CNH turn higher. Still to come today is Thailand trade data. Tomorrow, we get China Industrial profits, along with South Korea business sentiment. Thailand IP and Singapore unemployment figures are also due.

• USD/CNH sits around +0.30% higher versus NY closing levels from Tuesday. We were last just under 7.1580, with the pair having found some selling interest on the earlier move up to 7.1640. There hasn't been any positive follow up momentum to Hong Kong or mainland stocks so far today, which has likely tempered bullish CNH sentiment. The CNY fixing error was also narrower.
• 1 month USD/KRW spiked higher in early trade, but found selling interest above 1280. We last tracked close to 1276.50, still 0.15% weaker in won terms versus NY closing levels. The won has outperformed a fairly sharp pull back in onshore equities (the Kospi off 1.4%, while the Kosdaq is off 2.7% as momentum into EV stocks wanes). Earlier we had a further rise in July consumer sentiment and a pull back in inflation expectations.
• The Ringgit is little changed in early dealing on Thursday, operating in a narrow range with little follow through on moves. USD/MYR prints at 4.5590/4.5630, the pair is marginally below opening levels and has been consolidating below 4.60 handle in recent dealing. The KLCI index has risen ~0.5% and is set for its highest close since March 10. Global investors bought a net $30.8 million of Malaysian stocks on Tuesday, according to exchange data, adding to the strong inflows seen in July. A reminder that the local data docket is empty for the reminder of July, the next data due is July Mfg PMI next Tuesday.
• The SGD NEER (per Goldman Sachs estimates) is marginally firmer in early dealing, the measure sits a touch off cycle highs and is ~0.2% below the top of the band. USD/SGD fell ~0.4% as broader USD trends dominated flows amid, the pair remains well within recent ranges and sits a touch below the $1.33 handle. Industrial Production rose 5.0% M/M in June stronger than the forecasted 4.1%. Looking ahead on the wires early in tomorrow's session we have the June Unemployment Rate, the rate is expected to tick high to 1.9% from 1.8%.
• Rupee has weakened today, USD/INR is ~0.2% higher and sits above the 82 handle. Reuters noted, link here, that the RBI has been selling the Rupee to halt the downward momentum of USD/INR which had fallen 1.4% off July 10 highs. A reminder that the domestic data calendar is empty this week.
• USD/THB sits lower for the session, last at 34.41, which is around 0.30% firmer in baht terms for the session to date. Earlier highs were near 34.55, with baht modestly outperforming the stronger USD/Asia trend elsewhere (most notably USD/CNH) and higher USD levels against the majors (albeit away from best levels). There doesn't appear a fundamental catalyst for this modest outperformance, but it does threaten a break to the downside in terms of ranges for the week, although we remain comfortably above lows from last Thursday close to the 33.76 level. As we noted earlier, focus is likely to remain on the domestic political front, although prospects for meaningful headway in the near term appear low.