Overnight Dip In U.S. Tsy Yields Provides Reprieve To Asia EM FX

Asia EM FX got some reprieve in the wake of Tuesday's decline in U.S. Tsy yields, with participants assessing U.S. CPI data.

• CNH: Offshore yuan edged higher despite lingering sense of concern over China's Covid-19 situation. The government stepped up support for the economy by front-loading the allocation of special infrastructure bonds to provinces.
• KRW: The won outperformed in the Asia EM basket after the release of U.S. CPI data overnight, with core inflation narrowly missing expectations. Better than expected South Korean jobs data provided further support, as the unemployment rate held steady despite wider labour force participation.
• IDR: Spot USD/IDR clawed back its initial losses. Bank Indonesia Governor Warjiyo said that the central bank will wait with using monetary policy measures until there are signs of fundamental inflationary pressures.
• MYR: Spot USD/MYR retreated after printing a fresh multi-month high on Tuesday. Local headline flow was rather sparse.
• PHP: Spot USD/PHP fell after charting a dragonfly Doji candlestick on Tuesday. The Philippines has been hit by tropical storm Megi, which caused landslides and floods, claiming 56 lives so far.
• THB: Thai markets are shut in observance of a public holiday.