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JGBS

Futures Tight In the Tokyo Morning

KRW

South Korea's Exports Prove Resilient

CHINA PRESS

China Repo Rates Fall on Thursday

CHINA PRESS

Evergrande Risks Can Be Controlled: PBOC

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  • USD/RUB opens sharply higher this morning (+0.66%), driven by broad-based risk-off bolstering the BBDXY, post-election legitimacy concerns and softer oil markets.
  • The cross drifted +0.46% higher on Friday, but held below the 73.00 level, which gave way at the open this morning – drawing price action towards the 50 & 100dmas above in the 7.36-7.49 range.
  • As expected, Duma elections should see United Russia retain its supermajority, but by a narrower margin than in 2016 with the Communist Party coming in second place.
  • Some allegations of ballot stuffing have been noted and are under investigations, but the more important response will be to await any possible non-recognition from the international community and possible geopolitical consequences in the coming days.
  • Beyond this, we see PPI & industrial production data this week on the same day as the FOMC. All eyes will be on the dot plot for signs of lift off and median expectations for the frequency of hikes in 2024 alongside taper talk and timelines.
  • Sell-side remains constructive on RUB, so weakness will likely be met with a bias for fading at more attractive levels.
  • However, risks seeming remain tilted towards a hawkish market reaction to the Fed and near-term US Treasury volatility – hence, a tactical approach is necessary.
  • Intraday Sup1: 73.0263, Sup2: 72.8201, Res1: 73.3934, Res2: 73.5342