USD/Asia Pairs Mostly Lower, CNH Reverses Some Recent Outperformance

USD/Asia pairs are mostly lower, but losses have been fairly modest, in line with the major dollar indices down by around -0.10%. A slight pull back in UST cash Tsy yields has also likely helped at the margins. Still to come is the BNM decision, with no change expected, although it is a close call. Tomorrow, South Korea current account figures are due, along with India IP, while China aggregate credit figures are due soon (release window is 9-15th of March).

• USD/CNH sits slightly higher, but has found selling interest above 6.9800, last near 6.9770. The CNY fixing was close to neutral, while inflation prints came in well below expectations, tilting the odds in favor of more easing, although the reaction in China government bond yields hasn't been large. Onshore equities are weaker but only modestly.
• 1 month USD/KRW is slightly higher, last close to 1318, with a 1313 to 1320 range for the session. This has kept the pair within recent ranges, with a weaker CNH and lower onshore equities weighing at the margins.
• USD/TWD has tracked to fresh highs for the year, with spot above 30.80. Similar headwinds to the won have been noted.
• Rupee is slightly firmer, with USD/INR down around 81.85/90, +0.25% higher in INR terms so far for the session. Interestingly, Reuters reported earlier that the RBI was buying dollars, paying forwards. The rupee is the best performing Asian currency month to date, so the RBI may be using the more favorable flow backdrop to accumulate fresh reserves. Elsewhere in the region intervention risks are skewed the other way, with a number of USD/Asia pairs close to YTD highs.
• USD/THB is holding above the 35.00 level, last in the 35.05/10 region. This is little changed for the session and in line with relatively steady trends in terms of the USD indices. The simple 100-day MA for USD/THB is close by at 35.03, while the 200-day is higher at 35.51. The pair remains above all key EMAs, with the 200-day coming in at 34.74.
• The SGD NEER, reflected in sell side measures, was marginally firmer yesterday and sat ~0.8% from the top of the band. The latest MAS survey, released yesterday noted that 76.2% of respondents expect an unchanged MAS policy next month. MAS Managing Director Menon said this morning that the view that tightening by major central banks (the Fed/ECB etc) will end soon is "extremely optimistic", link here. Outside of offshore developments, the next CPI print, due on 23 March, presents a crucial input. The Jan data surprised on the downside, but core inflation pressures remain sticky (+5.5% y/y). USD/SGD is down a touch, last near 1.3530.