BOJ: Rinban Purchases

Taiwan saw its largest inflows since the US election, dip buyers emerged in Asia semiconductors stocks. Indonesia has now seen 10 straight sessions of outflows, while Philippines have seen 16 straight sessions of outflows.

• South Korea: Recorded outflows of -$37m yesterday, with a 5-day total of -$506m. YTD flows remain positive at +$5.65b. The 5-day average is -$101m, better than the 20-day average of -$156m but worse than the 100-day average of -$107m.
• Taiwan: Posted inflows of +$527m yesterday, totaling -$1.81b over the past 5 days. YTD flows remain negative at -$14.59b. The 5-day average is -$363m, worse than the 20-day average of -$216m and the 100-day average of -$212m.
• India: Experienced outflows of -$240m yesterday, with a 5-day outflow of -$284m. YTD flows are negative at -$2.47b. The 5-day average is -$57m, better than the 20-day average of -$251m but worse than the 100-day average of -$9m.
• Indonesia: Posted outflows of -$47m yesterday, bringing the 5-day total to -$235m. YTD flows remain positive at +$1.83b. The 5-day average is -$47m, slightly worse than the 20-day average of -$55m but better than the 100-day average of +$22m.
• Thailand: Recorded outflows of -$13m yesterday, with a total outflow of -$80m over the past 5 days. YTD flows are negative at -$3.69b. The 5-day average is -$16m, better than the 20-day average of -$27m but worse than the 100-day average of -$6m.
• Malaysia: Posted inflows of +$15m yesterday, reducing the 5-day outflow to -$19m. YTD flows remain positive at +$242m. The 5-day average is -$4m, better than the 20-day average of -$21m but worse than the 100-day average of +$4m.
• Philippines: Saw outflows of -$20m yesterday, with net outflows of -$111m over the past 5 days. YTD flows remain negative at -$232m. The 5-day average is -$22m, worse than the 20-day average of -$17m and the 100-day average of +$3m.

Table 1: EM Asia Equity Flows

In Tokyo morning trade, JGB futures are stronger, +7 compared to settlement levels, but lower than overnight closing levels.

• Japan exports rose 3.1%y/y in Oct, above market expectations of a 1.0% gain. The prior outcome was -1.7% in y/y terms. Some tick up is not surprising given other trends in export linked economies in Northeast Asia.
• Exports may have received some benefit due to front loading ahead of the US election, although exports to the US were still -6.2%y/y. Exports to the EU were -11.3%y/y, while to the China rose +1.5%y/y and were positive to Asia more broadly.
• Imports rose 0.4%y/y, versus a -1.9%y/y contraction. This modest upside surprise left trade positions in deficit and slightly wider than forecast. We were at -¥461.2bn, which was consistent with recent trends.
• Cash US tsys are ~1bp richer in today’s Asia-Pac session after yesterday’s modest haven demand-induced gains.
• Cash JGB curve has twist-flattened, with yields 2bps higher to 2bps lower. The benchmark 10-year yield is 0.3bp lower at 1.065% versus the cycle high of 1.108%.
• The swaps curve has bear-steepened, with rates flat to 4bps higher. Swap spreads are mostly wider.

The USD BBDXY index continues to track lower in the first part of Wednesday dealings. We were last near 1277.5, close to the lowest levels since in around a week. 

• Early trends favour higher beta/commodity related currencies, albeit at the margin. AUD and NZD are both up 0.15-0.20%. EUR is up 0.10%, while yen is is down modestly.
• The higher beta outperformance theme is consistent with Tuesday's session, where higher beta FX recovered through US trade. We are seeing a modest push higher in US equity futures in the first part of trade, up 0.20-0.30%, following cash gains in Tuesday trade.  We have key Nvidia earnings out this week. Regional equities, which are open at this stage, are mixed though.
• AUD/USD was last 0.6540, upside rests on the 20-day EMA at 0.6575. NZD/USD was last near 0.5920 (its 20-day EMA is at 0.5957).
• USD/JPY is up a touch to 154.80/85, leaving yen marginally underperforming on crosses. AUD/JPY was last near 101.30, still off recent highs of 102.405.
• In the cash Tsy space, we are slightly weaker in yield terms in the first part of trade.
• We had Japan trade figures earlier, with export and imports slightly stronger than forecast, but this had no market impact. 

• Coming up we have China LPR outcomes, but no change is expected. Otherwise we have some second tier Japan data out latter on.