Won Leads Gains Despite Covid Concerns, Peso Tumbles Ahead Of Holiday

Continued reassessment of Omicron risks provided the focal point overnight as broader headline flow carried little in the way of notable catalysts. The Korean won outperformed in Asia despite lingering domestic Covid worry.

• CNH: Spot USD/CNH held a tight range, price action was limited to a brief foray lower. The PBOC set the yuan reference rate in close proximity to sell-side estimate and provided another sizeable liquidity injection.
• KRW: The Korean won outperformed in Asia EM FX space, even as South Korea's daily Covid-19 cases bounced back above 5,000 and critical cases reached an all-time high. The latest BOK Business Survey showed that sentiment among South Korean manufacturers improved, which may have lent some support to the won.
• IDR: The rupiah went offered as Pres Widodo discussed implementing an overseas travel ban on all Indonesian citizens to prevent the spread of the Omicron variant across the country.
• MYR: Spot USD/MYR operated in a narrow range, ticked away from a fresh one-month low. Malaysia announced that it will halve the interval between the initial Covid-19 vaccination cycle and the booster dose for those receiving Pfizer and AstraZeneca jabs.
• PHP: The peso tumbled to its worst levels since mid-Oct ahead of Thursday's closure of onshore Philippine markets in observance of a public holiday. BSP Gov Diokno said that the central bank expect headline CPI inflation to settle within the +3.5%-4.3% Y/Y this month.
• THB: The baht softened a tad, ahead of End of Year/New Year holidays starting Friday. The currency was insensitive to a beat in Thailand's m'fing production, which received a boost from the relaxation of Covid-19 curbs.