USD/Asia Pairs Mostly Higher, MYR & THB Unwind Some Recent Outperformance

Most USD/Asia pairs are showing an upside bias in the first part of Tuesday trade. MYR and THB have faltered the most, which unwinds some of the recent outperformance for both currencies. MYR is down nearly 1%. Losses elsewhere are more modest, while the likes of IDR are relatively steady, with the regional equity bounce aiding broader risk appetite.

• USD/CNH has been relatively steady, finding selling interest above 7.1500. We last tracked near 7.1400, little change for the session. This is outperforming the softer yen trend, which is down around 0.80% against this USD at this stage. Local equities are off modestly, maintaining a low beta with respect to broader regional moves.
• Spot USD/KRW has firmed, pushing back towards intra-session highs from Monday, the pair last near 1373.5, around 0.30% weaker in won terms. Onshore equities have rebounded over 4%, but the won is taking greater cues from yen and CNH trends at this stage.
• USD/MYR is back to 4.4650, up from oversold conditions sub 4.4000 yesterday. This is around 0.90% weaker in MYR terms. Still we sit comfortably off mid July highs near 4.6900.
• USD/THB is also higher, by around 0.50%, last near 35.40. Monday lows in the pair were at 35.06. The nearest EMA resistance point is back near 35.94, the 20-day. We did have consumer confidence data earlier for July. The headline eased to 57.7 from 58.9 prior. Economic confidence fell to 51.3 from 52.6. Both measures are well above 2021/22 lows but the roll over in confidence since the start of the year is not a domestic demand positive. Politics was cited as a factor. The government will be hoping the digital wallet roll out turns sentiment/spending higher.
• USD/IDR has been relatively steady (last near 16180), not showing the same upside bias as other USD/Asia pairs. It has been a laggard in SEA compared to the likes of MYR and THB, so positioning may be less of a factor. The regional equity bounce today may also be providing a positive risk appetite offset. Indonesia 5yr CDS has edged down off recent highs today (last 80bps).