USD/Asia Pairs Mostly Higher To End The Week

Most USD/Asia pairs are higher in Friday dealings. Less positive regional equity sentiment, particularly in HK/China has weighed, while firmer core yields is a likely additional headwind. THB and KRW have lost the most ground this week, CNH has outperformed, although it has consolidated in recent trading. Next week we have the official China PMIs for Nov, along with the BOK and BOT decisions, among the highlights.

• We saw another step down in the USD/CNY fix (7.1151), a sharp drop over the past week. However, there wasn't much follow on USD/CNH selling, with the pair back above 7.1500 this afternoon (earlier lows were 7.1426). Onshore equities are under pressure, as well as HK markets. Local banks are struggling amid concerns over unsecured loans to property developers, which has been reported to be part of the latest efforts to help the ailing sector.
• 1 month USD/KRW has pushed higher in Friday dealings. The pair last near 1303, around Thursday session highs. Local equity sentiment has weakened, the Kospi off around 0.60% at this stage. Higher core yields have also likely weighed at the margin. The won rally has stalled this week, unable to sustain breaks sub 1300.
• USD/THB sits off session highs, last near 35.40. Earlier highs were at 35.48. This is fresh highs back to mid November, from last week. Baht is down around 0.40% for the session so far, and -0.90% for the past week, leaving it the worst performer in the EM Asia FX space over this period. Recent weakness in Thailand equities hasn't helped THB sentiment, while offshore investors have remained net sellers of local shares this week, -$145mn in net outflow so far. The Government is pushing ahead with its digital wallet plan, while the BoT has stated the country needs to preserve monetary and fiscal space.
• The SGD NEER (per Goldman Sachs estimates) is little changed this morning, we remain a touch off recent cycle highs. The measure sits ~0.3% below the top of the band. USD/SGD is dealing in a narrow range above the $1.34 handle this morning. The pair is ~0.5% above November lows as some of the month's losses have been trimmed in recent dealing. Weaker regional equities and firmer US Tsy Yields are weighing on sentiment in Asia today. Industrial Production rose 7.4% in October, a fall of 2.3% Y/Y had expected.
• The Ringgit has opened dealing little changed from yesterday's closing levels in a muted start to today's session. The wider USD/Asia space is also flat and ranges have been narrow. CPI in October ticked lower to 1.8% Y/Y, it had been expected to hold steady at 1.9%.
• The Rupee has opened dealing little changed in a muted start to Friday's dealing. US Tsy Yields have ticked higher this morning and Oil is pressured. Looking ahead, the highlight of next week's docket is Q3 GDP print on Thursday. A rise of 6.9% Y/Y is expected, the prior read was 8.0%. Also due on Thursday is the October Fiscal Deficit and the Eight Infrastructure Industries survey. On Friday S&P Global Mfg PMI crosses.