Negative Equity Tone Weighing On Asian FX

USD/Asia pairs are tracking higher in the first part of trading today. This is consistent with the majors, where the USD indices are tracking higher, with the BBDXY +0.20% to 1240 at this stage. Negative leads are evident in the equity space, with key regional bourses lower, while US futures are down -0.40% for eminis, -0.55% for the Nasdaq. We are slightly away from worst levels though.

• The USD/CNY fix was close to neutral, i.e. not pushing back aggressively against recent yuan weakness. USD/CNH touched a high of 6.8463, but we are now back around the 6.8400 level. Some resilience is evident in terms of China equities, which is helping at the margin.
• 1 month USD/KRW touched a high just above 1273, but we are now back to the 1272 region. The first 10-days of trade data for February still suggested a challenging external demand backdrop. Average daily exports were down -14.5% y/y and the trade deficit remained wide near -$5bn.
• Other USD/Asia pairs are mostly higher, albeit to varying degree. USD/MYR back near 4.3600, while spot USD/TWD is around 30.24/25. SGD FX is weaker, but outperforming these trends slightly, with USD/SGD at 1.3315/20 last, just +0.10% higher for the session so far.