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ASIA FX: USD/CNY Supported, KRW Softer, TWD Steady

ASIA FX
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In North East Asia, the bias has been for a firmer USD against CNY and KRW, while TWD has held close to flat. We remain within recent ranges for all pairs though. In the G10 space, the yen has once again outperformed, while other currencies are lower against the USD.

  • Onshore USD/CNY is still showing an upside bias, although we are still hold sub post inauguration highs. We were last 7.2840/45. This has likely lent some support to USD/CNH, which is a touch higher near 7.2880, leaving only a modestly positive basis. Earlier we had a very steady USD/CNY fixing, whilst onshore equity sentiment has firmed as the session has progressed. This hasn't lent support to FX sentiment though. To the extent higher USD/CNY onshore spot levels indicate underlying yuan depreciation pressures it may cap how far CNH can rally.
  • CNH/JPY has continued to track lower, the pair last under 20.90, fresh lows back to Dec 2024. Hawkish BoJ rhetoric has aided yen outperformance today.
  • Spot USD/KRW has drifted a little higher, last in the 1448/49 region. This leaves us back close to the 20-day resistance point. The Kospi is up a further 0.85% today, but this has done little to improve FX sentiment.
  • Spot USD/TWD is unchanged at 32.83 in latest dealings. Yesterday's rebound in equity inflows, coupled with CBC intervention (likely above 33.00 this week), is aiding modest TWD outperformance so far today.  
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In North East Asia, the bias has been for a firmer USD against CNY and KRW, while TWD has held close to flat. We remain within recent ranges for all pairs though. In the G10 space, the yen has once again outperformed, while other currencies are lower against the USD.

  • Onshore USD/CNY is still showing an upside bias, although we are still hold sub post inauguration highs. We were last 7.2840/45. This has likely lent some support to USD/CNH, which is a touch higher near 7.2880, leaving only a modestly positive basis. Earlier we had a very steady USD/CNY fixing, whilst onshore equity sentiment has firmed as the session has progressed. This hasn't lent support to FX sentiment though. To the extent higher USD/CNY onshore spot levels indicate underlying yuan depreciation pressures it may cap how far CNH can rally.
  • CNH/JPY has continued to track lower, the pair last under 20.90, fresh lows back to Dec 2024. Hawkish BoJ rhetoric has aided yen outperformance today.
  • Spot USD/KRW has drifted a little higher, last in the 1448/49 region. This leaves us back close to the 20-day resistance point. The Kospi is up a further 0.85% today, but this has done little to improve FX sentiment.
  • Spot USD/TWD is unchanged at 32.83 in latest dealings. Yesterday's rebound in equity inflows, coupled with CBC intervention (likely above 33.00 this week), is aiding modest TWD outperformance so far today.