USD/Asia Pairs Mostly Biased Lower, IDR Outperforms

The bias for most USD/Asia pairs has been skewed to the downside. Outside of USD/IDR, moves have been fairly modest though. The weekend focus will be on tomorrow's official China PMI prints, where expectations are mostly downbeat, while on Sunday December trade figures for South Korea print.

• USD/CNH has been supported sub 6.9700, but is attempting a move below this level. The CNY fixing was neutral. We expect the market to mostly look through tomorrow's PMI prints. An upside surprise would likely generate more of a market reaction than fresh downside momentum.
• 1 month USD/KRW has been range bound around the 1260 level, with onshore markets closed today. December CPI showed sticky core inflation pressures (4.8% y/y, versus 4.6% expected), which is likely to see the BoK raise rates (25bps) at the next policy meeting in mid January.
• USD/IDR is down a further 0.50% today in spot terms. The pair ended yesterday's session at 15658, but dipped as low as 15548 in early trade today before USD support emerged. We last tracked close to 15580. These moves follow BI intervention yesterday, which came after the pair rose to fresh 2yr highs. This puts USD/IDR back below its simple 50-day MA (15626), but not yet on an EMA basis (15559). The break below these support levels couldn't be sustained in early December.
• USD/THB is tracking to fresh lows, to levels last seen in the first half of June. The pair was last around 34.53. Signs of firmer domestic consumption is aiding the growth outlook (7.2% y/y for Nov), while net equity inflows were $244mn yesterday. A clean break sub 34.50 is likely to have the market targeting May lows around the 34.00 figure level.