EM ASIA CREDIT: MNI EM Credit Market Update - Asia

After an exceptional period of inflows into the major markets, it appears that this trend has stalled for now as constant daily flows are interrupted with outflows, with Taiwan, Indonesia and India the latest to experience a significant outflow.

• South Korea: Recorded inflows of +$172m the 2nd,  bringing the 5-day total to +$265m. 2025 to date flows are -$11,205. The 5-day average is +$53m, the 20-day average is +$53m and the 100-day average of -$112m.
• Taiwan: Had outflows of -$351m as yesterday, with total outflows of -$3,109 m over the past 5 days. YTD flows are negative at -$13,128. The 5-day average is -$622m, the 20-day average of +$165m and the 100-day average of -$138m.
• India: Had outflows of -$246m as of the 2nd, with total outflows of -$383m over the past 5 days.  YTD flows are negative -$10,774m.  The 5-day average is -$77m, the 20-day average of +$58m and the 100-day average of -$114m.
• Indonesia: Had outflows of -$45m as of yesterday, with total outflows of -$126m over the prior five days.  YTD flows are negative -$2,943m.  The 5-day average is -$25m, the 20-day average +$6m and the 100-day average -$30m.
• Thailand: Recorded outflows of -$47m as of 29th, outflows totaling -$84m over the past 5 days. YTD flows are negative at -$1,755m. The 5-day average is -$17m, the 20-day average of -$2m and the 100-day average of -$18m.
• Malaysia: Recorded outflows of -$29m as of yesterday, totaling -$254m over the past 5 days. YTD flows are negative at -$3,452m. The 5-day average is -$54m, the 20-day average of +$8m and the 100-day average of -$25m.
• Philippines: Saw inflows of +$3m yesterday, with net outflows of -$255m over the past 5 days. YTD flows are negative at -$512m. The 5-day average is -$51m, the 20-day average of -$13m the 100-day average of -$5m.

• China's key bond futures are moving in the opposite direction today as the OMO maintained liquidity with a very modest withdrawal.  
• The 10YR future is lower by -.03 at 108.63 having just breached the 100-day EMA of 108.64
• The 2YR future is up +.01 to 102.36 and remains below all major moving averages.  The nearest being the 20-day EMA at 102.42.
• Bonds are seeing limited movement with the CGB10YR at 1.70.  The CGB10YR has traded in a tight range of 1.61-1.71 since early April.  

At the Tokyo lunch break, JGB futures are weaker, -19 compared to the settlement levels, and hovering near Tokyo session lows.

• (Bloomberg) -- Japan currently hasn’t received a letter from the US Trade Representative’s office, sent to trading partners as a deal deadline reminder, Japanese Chief Cabinet Secretary Yoshimasa Hayashi says in a regular press conference Wednesday.
• Japan's private sector experienced a loss of growth momentum in May, with the headline au Jibun Bank Japan Services Business Activity Index easing to 51.0 in May from 52.4 in April.
• Cash US tsys are flat to 1bp richer, with a flattening bias, in today's Asia-Pac session after yesterday's modest losses. The 10-year yield continues to find good support around 4.35/40%.
• Cash JGBs are flat to 1bp cheaper across benchmarks, with the futures-linked 7-year underperforming. The benchmark 10-year yield is 0.7bp higher at 1.501% versus the cycle high of 1.596% after yesterday's strong auction result.
• Swap rates are slightly higher. Swap spreads are mostly tighter.