Redback Reverses Losses As Asia EM FX Space Finds Poise

The U.S. dollar lost allure and most Asia EM currencies gained, led by a rebound in offshore yuan.

• CNH: Spot USD/CNH pulled back sharply after a failed re-test of cycle highs printed on Monday, as Chinese equities recouped their opening losses. The redback paid little attention to the PBOC fix, which ended a streak of downside surprises. The mid-point of permitted USD/CNY trading band was set a mere 5 pips shy of sell-side estimate, following a series of two-digit surprises in the recent days, when the People's Bank was leaning against yuan depreciation. Worth noting that the PBOC reiterated its pledge to support the economy in the quarterly monetary policy report released on Monday.
• KRW: Spot USD/KRW lodged a fresh cycle high at KRW1,278.75, the strongest level since Mar 23, 2020. President Yoon Suk-yeol formally took office.
• IDR: Spot USD/IDR went offered after Thursday's data showed that headline CPI inflation accelerated to a multi-year high, printing slightly above median estimate.
• MYR: Spot USD/MYR faltered ahead of BNM monetary policy decision, due tomorrow. In the meantime, Malaysia's Department of Statistics reported that industrial output grew 5.1% Y/Y in March, beating expectations.
• PHP: Spot USD/PHP lost ground as onshore markets re-opened after the Election Day. Preliminary results showed that Ferdinand Marcos was on track to win the presidential poll by a landslide, while Sara Duterte was poised to secure a resounding victory in the vice-presidential race.
• THB: The baht outperformed the greenback in line with regional trend, even as Thailand's monthly consumer confidence index fell to a multi-month low of 40.7.
• INR: The rupee re-opened on a firmer footing after BBG circulated a source report Monday noting that the RBI was intervening in all FX markets and intended to continue to do so.