USD/Asia Pairs Up From Lows, Busy Data Calendar Tomorrow

USD/Asia pairs have moved off earlier lows, with Asian FX losing momentum as the session progressed. USD/CNH pushed back above 7.3000, but remains below pre-US data levels from Tuesday's session. 1 month USD/KRW also couldn't break lower. USD gains are modest overall though. Tomorrow, we get China official PMI prints for August, which will be the main focus. South Korean IP also prints, along with Indian Q2 GDP and Thailand IP and Bop/trade data.

• USD/CNH has tracked higher in recent dealings, last near 7.3000, around 0.20% weaker since the open in CNH terms. Earlier lows were at 7.2816. This keeps us within recent ranges, but we have unwound some of the USD weakness seen post Tuesday data misses - highs for USD/CNH prior to these prints were just above 7.3100. CNH weakness has coincided with a loss in positive momentum for local equities, which are back to around flat after being as high as +0.60%for the CSI 300.
• 1 month USD/KRW couldn't test lower, despite a positive equity lead from Tuesday. The Kospi is +0.50% higher, but the 1 month is still support in the 1316/17 region. We last tracked near 1321, remaining well within recent ranges.
• USD/THB is above earlier lows just under 35.00, the pair last near 35.10. We remain comfortably within recent ranges, with baht bulls targeting a sustained break of the 20-day EMA, which comes in at 35.03, while on the topside, August highs sit back near 35.60. On the tourism front, new PM Srettha is reportedly looking at easing rules (such as cutting fees and extending stay limits) for travelers from China and India in order to boost the outlook ahead of the Q4 peak tourism season.
• USD/IDR gapped lower at the open, hitting 15217, but sits slightly higher now, last near 15235, still ~0.15% firmer in IDR terms versus yesterday's close. The 1 month NDF has seen modest upside today versus NY closing levels on Tuesday, last at 15241. IDR has benefited from the pull back in US real yields following US data misses, the 10yr back to +183bps, versus recent cyclical highs of +200bps. BI Governor Wariyo stated late yesterday that 68 exporters had placed export proceeds into special accounts onshore, up from 34 previously. The Governor stated this could bring in $8-9bn in extra FX reserves by December. The central bank sees USD/IDR averaging 14850 next year versus 15000 for 2023. Note the YTD 2023 average is 15080.
• The Rupee sits marginally below Tuesday's closing levels. USD/INR prints at 82.76/78, ranges in the pair remain narrow and moves have had little follow through in recent dealing. We sit above 20-Day EMA (82.6844) and well within the August range. India has cut cooking gas prices to soften the impact of rising inflation on household expenses as the nation heads into seasonal festivals and key elections. Q2 GDP is due tomorrow, an uptick to 7.8% Y/Y from 6.1% is expected. Also on the wires tomorrow is the July Fiscal Deficit and Eight Infrastructure Industries Index.
• The Ringgit is firmer in early dealing as onshore markets digest yesterday's weaker than forecast US data. USD/MYR prints at 4.6385/4.6430 ~0.1% lower in early dealing. The pair now sits ~0.6% below the August high as monthly gains continue to be trimmed.
• The SGD NEER (per Goldman Sachs estimates) is marginally softer in early dealing and has ticked away from its highest level since 18 Jul in recent dealing. The measure is ~0.4% below the top of the band. The SGD NEER (per Goldman Sachs estimates) is marginally softer in early dealing and has ticked away from its highest level since 18 Jul in recent dealing. The measure is ~0.4% below the top of the band. The pair has found support below the 20-Day EMA ($1.3511) and sits a touch above the measure in early dealing today.