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ASIA FX: Won Recovering While Rupiah Weakens Sharply On Fiscal Uncertainty

ASIA FX
BulletEM BulletAPACEmerging Market News

Asian currencies are mixed against the US dollar during trading today with the rupiah weaker but won stronger. The BBDXY USD index is close to its intraday low to be down 0.2% after it finished 2024 strongly.

  • USDKRW is down 0.3% to 1467.30, after a low of 1466.0. Political uncertainty remains elevated with new acting President Choi’s advisers wanting to resign, which he rejected. There is concern that these issues will weigh on growth going into 2025 and the manufacturing PMI fell to 49.0 in December from 50.6.
  • In contrast, USDIDR is 0.8% higher at 16230 after an intraday peak of 16258.5. Rupiah weakness has been driven by President Prabowo’s decision to materially narrow the number of goods that the VAT increase will impact. Finance minister Indrawati tried to reassure markets stating that the 2024 deficit is likely to be lower than estimated.
  • USDIDR is up 0.3% since December 23 and 1.0% since the December 18 Bank Indonesia meeting. It next meets on January 15 and if there isn’t significant rupiah strengthening before then, a rate cut is again unlikely.
  • USDCNH is down 0.3% to 7.3172 following an intraday low of 7.3161. The Caixin December manufacturing PMI disappointed falling to 50.5 from 51.5.
  • USDPHP is little changed at 57.82, USDTHB is up 0.3% to 34.21, while USDSGD is down 0.4% to 1.3613 after a stronger-than-expected Q4 GDP release.
  • India’s HSBC final December manufacturing PMI and December Thai business sentiment are coming up.
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Asian currencies are mixed against the US dollar during trading today with the rupiah weaker but won stronger. The BBDXY USD index is close to its intraday low to be down 0.2% after it finished 2024 strongly.

  • USDKRW is down 0.3% to 1467.30, after a low of 1466.0. Political uncertainty remains elevated with new acting President Choi’s advisers wanting to resign, which he rejected. There is concern that these issues will weigh on growth going into 2025 and the manufacturing PMI fell to 49.0 in December from 50.6.
  • In contrast, USDIDR is 0.8% higher at 16230 after an intraday peak of 16258.5. Rupiah weakness has been driven by President Prabowo’s decision to materially narrow the number of goods that the VAT increase will impact. Finance minister Indrawati tried to reassure markets stating that the 2024 deficit is likely to be lower than estimated.
  • USDIDR is up 0.3% since December 23 and 1.0% since the December 18 Bank Indonesia meeting. It next meets on January 15 and if there isn’t significant rupiah strengthening before then, a rate cut is again unlikely.
  • USDCNH is down 0.3% to 7.3172 following an intraday low of 7.3161. The Caixin December manufacturing PMI disappointed falling to 50.5 from 51.5.
  • USDPHP is little changed at 57.82, USDTHB is up 0.3% to 34.21, while USDSGD is down 0.4% to 1.3613 after a stronger-than-expected Q4 GDP release.
  • India’s HSBC final December manufacturing PMI and December Thai business sentiment are coming up.