Most USD/Asia Pairs Higher, CNH Ignores Local Equity Volatility

Most USD/Asia pairs are higher in line with firmer USD index levels post the Fed Chair Powell interview earlier. Carry over from Friday's USD gains has also been evident. China equity volatility continues, but isn't spilling over into wider sentiment at this stage. Tomorrow, we have Philippines CPI as the main focus point.

• USD/CNH has drifted a little lower in the first part of Monday trade. The pair last near 7.2100. Earlier highs above 7.2200 drew selling interest. Equities sentiment has been very volatile in small cap stocks particularly, but the post lunch break has seen some firmness return, with the CSI 300 back in positive territory as the regulatory warned it would take measures against risks of stock pledges (BBG). The USD/CNY fixing error re-widened, consistent with USD strength.
• 1 month USD/KRW is comfortably off Friday highs, the pair around 0.50% stronger in won terms, last near 1330. This keeps us within recent ranges though and avoids a fresh 1340 test. Onshore equities have recouped earlier losses, the Kospi last near -0.70% after being down by 2% at one stage.
• USD/IDR pushed above 15700 in early trade today, but sits slightly lower in latest dealings. Friday lows in the pair were close to 15645, which recent weakness above 15800 saw intervention rhetorci rise. Weekend comments from BI Governor Perry Warjiyo reiterated that the rupiah is central to the outlook for easier policy settings. The Governor stated that it will look to rupiah stability in the second half to gauge the CB's ability to cut rates.
• USD/THB is around session highs, last in the 35.70/75 region, around 1.35% weaker in baht terms for the session. We are sub late Jan highs at 35.88, but back above all key EMAs. The 200-day coincides with recent lows in the 35.20/25 region. Jan CPI data was a touch weaker than expected and the government has been on the wires this afternoon talking about the potential need for near term stimulus.
• USD/PHP sits back at 56.25 in recent dealings, around 0.60% weaker in spot PHP terms. The 1 month NDF is slightly higher and also weaker in PHP terms versus end Friday levels in NY on Friday (last at 56.28).Broader USD gains and a firmer US yield backdrop have continued today. These moves keep us within recent ranges though. Spot lows around 55.92 last week, were just under the simple 200-day MA. Topside resistance could be expected just above 56.50, which has marked recent highs. Domestic political developments will remain a focus point, although broader concern in asset markets is not evident. Local shares sit just off recent highs. The National Security Advisor to President Marcos Jr stated the country will use force to quell secession moves.