Weaker CNH Weighing On The Rest Of The Region

(MNI Australia) USD/CNH continues to rise, moving through 6.9300 (high of 6.9327). We are slightly off these highs at the time of writing, last around 6.9285, but we are within striking distance of early Jan highs close to 6.9400.

• Onshore equities are weaker, the CSI 300 down nearly 1%. So far today, northbound equity outflows have totaled nearly 3.5bn yuan. Not that large, but tracking for the third straight day of outflows.
• US-China tensions may be weighing on equity sentiment. There are reports the US will raise the number of troops it has stationed in Taiwan (see this link for more details), while the threat of additional sanctions over the Ukraine conflict is also something the market is likely mindful of.
• The weaker CNH trend is spilling over to other FX in the region, mostly notably in NEA. Spot USD/KRW is back to 1301, +0.30% firmer for the session, while USD/TWD is +0.25% higher, last near 30.47.
• Other USD/Asia pairs are also tracking higher, with USD/THB to 34.74 (+0.20%), while USD/IDR is +0.15%, last near 15215/20.