Positive Risk Mood Supports Asia EMFX, Won Leads Gains On Hawkish BoK

The dollar index faltered in Asia, while broader risk tone remained positive, as light regional headline flow failed to offset the optimistic reception of the U.S. infrastructure deal.

• CNH: USD/CNH extended yesterday's losses past its 100-DMA, with an in-line PBOC fix providing little in the way of fresh impetus.
• KRW: The risk-sensitive won outperformed its regional peers, with USD/KRW printing a one-week low. Yesterday's hawkish rhetoric from BoK Gov Lee and continued improvement in business sentiment among South Korean manufacturers provided local tailwinds for the KRW.
• IDR: The rupiah struggled to follow suit and benefit from better risk sentiment. The difficult Covid-19 situation in Indonesia continued to sap demand for the IDR.
• MYR: The ringgit firmed a tad. Science Min Khairy said yesterday that the gov't is set to announce a "big economic assistance package," but refused to reveal any details. Malaysian May CPI printed at +4.4% Y/Y, missing consensus forecast of +4.7%.
• THB: USD/THB retreated after a failure to take out the THB32.00 figure yesterday. Thailand's parliament approved only a limited tweak to the constitution, shrugging off demands of pro-democracy protesters.
• PHP: The peso gained alongside most Asia EM currencies. Bangko Sentral ng Pilipinas held rates on hold Thursday and marginally upgraded its 2021 CPI forecast.
• SGD: USD/SGD fell to a new one-week low. Singapore pledged to expand its Covid-19 vaccination campaign from next month, while FinMin Wong anticipated looser rules for inoculated residents.
• TWD: USD/TWD slipped, but struggled to get past its 50-DMA. Japan said Taiwan's stability is directly linked to its own security and pledged to donate 1mn vaccine doses to the island.