BOJ: Rinban Purchases

• South Korea: South Korea experienced an outflow of $139m Friday, leading to a net outflow of $1.52b over the past five trading days and we have now marked 8 straight session of selling by foreign investors. Year-to-date, however, the country has accumulated substantial inflows totaling $16.29b. The recent 5-day average shows an outflow of $305m, which is below the 20-day average of -$121m, while the 100-day average remains positive at $28m.
• Taiwan: Taiwan recorded an outflow of $166m Friday, contributing to a net outflow of $1.91b over the past five trading days. Year-to-date, Taiwan has seen outflows totaling $9.70b. The 5-day average shows an outflow of $381m, which is below both the 20-day average of -$22m and the 100-day average of -$138m.
• India: India saw an inflow of $1.73b Thursday the largest inflow since March, leading to a net inflow of $2.82b over the past five trading days. Year-to-date, India has accumulated inflows totaling $17.91b. The 5-day average is $588m, well above the 20-day average of $52m, and the 100-day average remains slightly positive at $36m.
• Indonesia: Indonesian equities recorded an inflow of $722m Friday the largest inflow since April 2022, contributing to a net inflow of $974m over the past five trading days. Year-to-date, Indonesia has accumulated inflows totaling $1.83b. The 5-day average inflow is $195m, above the 20-day average of $88m, and well above the 100-day average of $0m.
• Thailand: Thailand experienced an outflow of $93m Friday ending 5 straight sessions on inflows the past 5 sessions have seen a net inflow of $35m. Year-to-date, Thailand has seen outflows amounting to $3.45b. The 5-day average shows an inflow of $7m, compared to the 20-day average of -$8m, and the 100-day average of -$15m.
• Malaysia: Malaysia recorded an inflow of $96m Friday and continues to see strong demand for local stocks having seen just a single day of outflows over the past 14 sessions this has led to a net inflow of $347m over the past five trading days. Year-to-date, Malaysia has seen inflows totaling $696m. The 5-day average inflow is $69m, above both the 20-day average of $28m and the 100-day average of $9m.
• Philippines: The Philippines recorded an outflow of $5m Friday, ending 14 days of straight inflows leading to a net $80m inflow over the past five trading days. Year-to-date, the Philippines has experienced outflows totaling $324m. The 5-day average inflow is $16m, above both the 20-day average of $7m and the 100-day average of -$5m.

Table 1: EM Asia Equity Flows

JGB futures remain within recent ranges in the first part of Monday dealing. The September future last 144.54, -.18 versus settlement levels.

• We did have an early dip to 144.51, but we couldn't test sub Friday lows, just under this level.
• Outside of the earlier Capex data, which point to positive Q2 GDP revisions (due next Monday), news flow has been light. US Tsy futures volume is very light ahead of the Labor Day holiday later.
• In the cash JGB space yields have ticked higher, the 10yr back above 0.91%, while the 30 and 40yr tenors are up over 2bps in yield terms.

Voters in two states of eastern Germany have sent a very strong message to Berlin with the three parties in the federal governing coalition struggling to receive enough votes to exceed the 5% hurdle and parties of the extremes receiving around half of the vote or more. People in the region continue to feel left behind compared to the more prosperous west, which has also added to anti-immigrant sentiment.

• Federal elections are due in 2025 and the ruling centre-left SPD, Greens and liberal FDP are well behind in the polls. The opposition centre-right CDU is polling almost 10pp above its 2021 election result and the SPD of Chancellor Scholz around 10pp below, according to wahlrecht.de.
• All mainstream parties have refused to work with the far-right AfD which is going to make forming state coalitions in eastern Germany very difficult given their high share of the vote.
• In Saxony the centre-right CDU held onto its lead and is set to receive around 31.9% of the vote down only 0.2pp from 2019, but the hard right AfD increased its share by 3pp to 30.6%. A new party of the far left established by former Left member Sahra Wagenknecht received 11.8% of the vote resulting in support for the Left dropping below the required 5%. The SPD won 7.3%, Greens 5.1% and FDP only 0.9%.
• The far-right AfD won its first election in Thuringia receiving 32.8% of the vote, higher than polls suggested with the CDU in second with 23.6%. Both polled more than in 2019 but the federal coalition parties saw support drop 8pp with the Greens and Liberals unable to reach 5%. Including the far left, extremist parties won almost 61% of the vote.
• Another eastern state Brandenburg holds elections on September 22 and while the SPD and CDU are both polling around 20%, the extremes together are expected to receive around 45% of the vote.