USD/CNY Supported On Dips Despite Stronger Fixing

USD/Asia pairs are lower for the most part, but the dollar has been supported on dips so far today. We had another stronger CNY fixing, but the follow through USD selling was more limited today versus yesterday. Spot USD/CNY sits comfortably above 7.2000. TWD has weakened more so than KRW, while in SEA, IDR has struggled to see much upside. Tomorrow, we have China industrial profits, along with South Korea business sentiment.

• Focus for the yuan was once again on the CNY fixing. It printed firmer than forecast, although the gap wasn't as wide as Monday's session. Spot USD/CNY initially dropped at the open but was supported on dips, the pair last near 7.2180, close to session highs. This hints at less state bank USD selling pressure compared to previous periods when the 7.2000 level wasn't breached. USD/CNH dipped under 7.2400, but there was no follow through.
• 1 month USD/KRW has tracked recent ranges for the most part, last near 1337.5, little changed for the session. There still appears to be some selling interest above the 1340 level. Onshore equities are firmer, amid positive headlines around potential tax cuts for companies raising dividends. Earlier, consumer sentiment fell for March, while inflation expectations rose.
• Spot USD/TWD and the 1 month NDF has pushed back above 31.90, largely reversing Monday losses in the pair. Still, we remain sub recent highs above or near 32.00. We had equity market weakness earlier, but we are away from session lows. Lack of downside in USD/CNY will be a factor. Headlines also cross that former President Ma will meet with China President Xi Jinping in April in Beijing.
• Thailand’s February customs trade deficit narrowed close to expectations at $554mn after a deficit of $2758mn. Export growth slowed to 3.6% y/y from 10% y/y but continued to outpace imports at 3.2% up from 2.6%. USD/THB sits slightly lower, last just under 36.40.
• We had Singapore IP figures print stronger than forecast for Feb, up 3.8% m/m and 14.2% y/y. This comes after yesterday's stronger than expected CPI print. This should rule out any near term MAS pivot to easier policy settings. USD/SGD was last just under 1.3450.
• USD/IDR is relatively steady near 15800 in latest dealings. We are very close to recent highs, while Jan highs in the pair came in at 15843. Foreign Investors bought bonds on Friday, marking just the 2nd day from the past 12 of net inflows. In cross-asset moves, the JCI is 0.44% lower, Palm Oil is down 0.12%, while US Tsys yields are flat to 1.5bps lower.