Most USD/Asia Pairs Tracking Lower Ahead Of FOMC

Most USD/Asia pairs are lower today, in with further USD weakness ahead of the FOMC later. USD/CNH hasn't seen much downside, but China markets have remained closed today, they re-open tomorrow. IDR is also lagging somewhat. The rest of the region is on the front foot, with lower energy prices likely helping at the margins. Still to come is the BNM decision, with no change expected, also out later is Singapore PMIs. Tomorrow, China Caixin PMIs print, along with South Korean FX reserves.

• USD/CNH couldn't sustain an earlier dip sub 6.9300. We now sit back above 6.9360, little changed for the session. China related equities have faltered in HK. Tomorrow, we get Caixin manufacturing and service PMI prints.
• 1 month USD/KRW is down around 0.40% at this stage, last near 1334/35, which is the bottom end of the recent range. Comments by BoK Governor Rhee that it is too early to talk about a pivot to rate cuts and stating that FX pressure should ease once we are clear of the dividend outflow period has aided sentiment today.
• Spot USD/IDR has crept higher today. The pair last near 14710, with offers evident above 14720. This is only slightly weaker than yesterday's close, but the rupiah is underperforming the rest of the USD/Asia bloc, where USD weakness is more evident. This likely reflects renewed risk aversion in the equity space, which has seen Indonesia 5yr CDS creep higher, last just above 97bps. Weaker commodities are also likely to be weighing at the margins. Palm oil prices are lower, back to 3969/MYR, with likely some spillover from the oil plunge on Tuesday.
• USD/INR prints at 81.80/81, the pair is down ~0.1% in early dealing on Wednesday. A 5% fall in WTI Crude futures yesterday as concerns grow about the US economy have aided the rupee today.• The pair continues to consolidate below the 20-Day EMA, bears look to target 200-Day EMA (81.14). Bulls first look to break the 20-Day EMA at 82.00. The Apr services PMI surged to 62.0 from 57.8 in Mar.
• USD/THB hasn't been able to sustain a breach of the 34.00 level. The pair last close to 34.04, against earlier lows of 33.993. Still, the baht is around 0.50% stronger versus yesterday's closing levels, aided by the continued pull back in the USD (particularly against the yen) during today's Asia Pac session. CPI outcomes were close to expectations.
• USD/MYR prints at 4.4560/4600, the pair is down ~0.1% as the ringgit marginally firms on Wednesday, not showing too much impact from the weaker oil price backdrop. The pair printed its highest level since mid-March yesterday, however narrow ranges continue to persist. USD/MYR continues to consolidate above the 20-Day EMA, rallies have been capped ahead of 4.47 with support seen at 4.45.