Rupiah Slumps On Local Political Uncertainty

USD/Asia pairs are mixed in NEA, CNH losing ground modestly despite a firmer local equity backdrop (liquidity conditions have eased, so this has likely weighed). KRW is a little weaker, while TWD has risen. In SEA, FX weakness in THB and IDR remain focus points. The Indonesian authorities intervening to curb IDR weakness, amid local political uncertainty. Looking ahead, tomorrow we have Philippines Dec trade data, Thailand Dec trade figures as well, along with Singapore IP.

• USD/CNH has held above 7.1600 for much of the session, the pair last near 7.1650. This comes despite a decent rally in onshore equities, following yesterday's RRR cut and further support for onshore property developers. The CSI 300 currently up 1.3%. Still, liquidity conditions have eased further in CNH, the TN back into negative territory, which has worked the other way from a CNH standpoint.
• 1 month USD/KRW sits slightly higher, although hasn't been able to convincingly break above 1334, which is where we last track (we opened around 1331). This leaves the pair well within recent ranges. Earlier Q4 GDP came out close to expectations, with weaker consumer spending/construction activity offset by firmer exports/business investment. Onshore equities are tracking around flat for the Kospi.
• USD/TWD sits marginally lower but more so in terms of spot than the 1 month NDF. Spot was last sub 31.30, but we remain within recent ranges. Local equities continue to track higher, +0.60%, while offshore investors have so far accumulated +$2bn in local shares this week.
• USD/IDR spot spiked higher on reports that local ministers, including Finance Minister Sri Mulyani Indrawati, are looking at resigning (BBG). This is reportedly over current President Jokowi's support for Prabowo Subianto at the upcoming election. Spot currently sits at 15795, at session highs. Headlines later cross of BI intervention, but dips in USD/IDR have been shallow. The 1 month NDF is above 15820 in latest dealings, which is fresh highs back to early Nov last year.
• USD/THB has firmed, although we remain below Wednesday highs. The pair was last in the 35.70/75 range, against yesterday's high of 35.88, which was the highest print for the pair since mid-November last year. Headlines crossed earlier from the Deputy Thailand Finance Minister Julapun, stating the authorities are concerned about THB volatility, while also stating that he hopes interest rates are cut soon to boost the economy. The government is doing all it can to boost the economy. This was from a BBG interview on Wednesday.