Won Leads Asia EMFX Lower, Amid Lingering Virus Worry

Most Asia EM currencies retreated, as regional players played catch up with Tuesday's risk-off flows and showed continued concern over the spread of Covid-19 infections across the continent.

• CNH: The yuan ignored a slightly softer than expected PBOC fix, which allowed USD/CNH to edge lower. The rate stuck to a relatively narrow range.
• KRW: The won led losses in Asia EM space, after South Korea's daily Covid-19 case count topped 1,200, reaching the highest level since Dec 2020. PM Kim suggested officials will consider whether to tighten social distancing rules. Samsung reported better than expected Q2 earnings, which may have helped KRW avoid a deeper slump.
• IDR: The rupiah traded on a slightly softer footing, as Indonesia continues to fight its worst wave of Covid-19. The nation reported another record increase in new cases on Tuesday.
• MYR: The ringgit underperformed the greenback as Malaysia added the most coronavirus infections in more than one month, a day before Bank Negara Malaysia's monetary policy meeting.
• PHP: The peso continued its sharp depreciation, with a local analysts flagging corporate demand for the USD. Tuesday's miss in headline CPI and BSP speak which ensued likely added some pressure to the PHP. Spot USD/PHP advanced to its best levels in over a year.
• THB: Spot USD/THB printed its highest levels in 14 months, before trimming gains. The BoT released minutes from its latest monetary policy meeting, in which the MPC warned that the current wave of Covid-19 will be the main contributor to volatility in domestic financial markets.
• TWD: USD/TWD edged higher ahead of the release of local CPI and trade data, due later today.
• SGD: Little to pen for the Singdollar, which oscillated around unchanged levels in Asia. USD/SGD 1-week implied volatility ticked higher, with local GDP report coming up in one week's time.