USD/Asia Pairs Lower, A Number Approaching 50-day EMA Support Zone

USD/Asia pairs are mostly tracking to the downside in the first part of Wednesday dealings. Part of this is catch up to USD weakness post onshore closes yesterday, but it also fits with the majors where high beta FX is outperforming at the margins.

• USD/CNH sits back near 7.2315, off recent highs above 7.2400. As expected the 1yr MLF was kept unchanged at 2.50%. The roll over amount matches with May maturities as well. Local equity sentiment is modestly weaker. The market is awaiting China's response to US tariff announcements yesterday, but a dramatic escalation is not expected.
• Headlines have also crossed from BBG that China is considering a proposal where local governments would purchase unsold homes to reduce over supply (see this link). The dollar has softened on these headlines, but follow through has been limited.
• 1 month USD/KRW is lower, last around 1360, but remains within recent ranges for May so far. We are +0.25% stronger in KRW terms versus end NY levels. The 50-day EMA is around 1356.55 on the downside. A reminder that onshore markets are closed today.
• Spot TWD is around 0.50% firmer, last near 32.25/30, while the 1 month NDF is back to 32.22. We are trending back towards the 50-day EMA (32.14), which is a support zone which held in early May. Equity sentiment is positive amid recent tech gains (the Taiex is up 1.45% so far today).
• USD/THB has fallen to 36.50, but sits slightly higher in recent dealings. This is fresh lows back to mid April for the pair.
• USD/PHP is back to 57.65, around 0.35 stronger, but the 1 month NDF has seen a more modest PHP gain. Tomorrow, we have the BSP decision but no change is expected.
• Spot USD/IDR is back under 16100, but has only posted modest gains in IDR terms so far. April trade figures print later, with a narrower trade surplus expected.