USD/Asia Pairs Lower, Aided By Broader USD Pullback

USD/Asia pairs are lower in line with broader dollar trends/improved equity risk appetite. We sit slightly above session lows in latest dealings and overall gains (outside of the won) have been fairly modest. The main focus today has been CPI prints. South Korea and Philippines prints surprising on the upside, while Thailand's was to the downside. Still to come is Taiwan CPI. Tomorrow, we have the RBI decision in India (no change expected), along with a number of regional FX reserve prints.

• 1 Month USD/KRW last tracked near 1348, against earlier lows close to 1345. Equity sentiment has firmed (Kospi +0.40%), but offshore investors remain net sellers of local stocks (-$99.4mn). At the start of the session, the South Korean FinMin stated that the authorities will actively curb FX risks. CPI headline pressures were stronger than expected in September but core was steady.
• Spot USD/THB got to a low of 36.795 in early dealing, but we now sit slightly higher, last near 36.93. This is comfortably off recent highs above 37.20. Headline CPI eased to 0.3% y/y from 0.9% in August and core to 0.6% from 0.8%, the lowest since January 2022, and both well below the Bank of Thailand’s 1-3% target. These extremely low inflation prints are likely to confirm the signal from the BoT at its September meeting that it is ready to pause.
• USD/PHP sits slightly lower, last near 56.66, which is towards the bottom end of the recent range. We have only seen modest peso gains so far today, with the authorities likely curbing recent upside USD/PHP pressures against a stronger USD backdrop (which may be limiting follow through downside in the pair). September CPI was at the top end of the BSP's forecast range (6.1% y/y) and the central has stated it stands ready to resume the tightening cycle. Local equities are noticeably weaker, down close to 1% at this stage, a potentially more hawkish BSP backdrop not helping.
• USD/INR is very steady, last near 83.23, a touch below recent highs. The services PMI printed for September, rising to 61.0 from 60.1, underpinning a strong domestic growth backdrop. Tomorrow, the RBI is expected to hold rates steady, but retain a tightening bias.
• USD/IDR got to lows of 15575, but now sits back above 15600. Recent highs remain intact around the 15644 level.