ASIA FX: USD Firmer Against Most SEA FX, CNH & KRW Outperform
Jul-31 05:30
Some South East Asian currencies have weakened noticeably in the first part of Thursday trade. PHP is the weakest performer, down around 1.3% in spot terms so far today. THB has lost ground, so too has MYR, INR and IDR. For INR and IDR intervention efforts have likely curbed USD upside. In North East Asia, CNH and KRW have outperformed, while TWD has lost ground.
- Spot USD/PHP has surged, the pair getting close to 58.38, last near 58.34, 1.3% weaker versus the USD so far today. Sensitivity to a hawkish Fed hold on Wednesday, coupled with month end dynamics look to be weighing on the Peso. Earlier 2025 highs around the 58.70/75 region are the likely next upside target.
- USD/IDR is up 0.40%, last close to 16460, eyeing a 16500 test. Similar dynamics could be in play, although headlines crossed earlier that the BI was intervening to curb rupiah losses.
- USD/INR opened higher, getting too 87.74, but sits back at 87.55/60 in latest dealings. We aren't too far away from a 88.00 test. INR is under pressure amid trump tariff threats, with earlier remarks from the US President suggesting a positive trade deal was unlikely to be announced in the near term (although it is likely both sides are still talking).
- USD/MYR is above 4.2500, while USD/SGD is lower, last near 1.2940, taking its cue from the better G10 tone seen against the USD. USD/THB is firmer, last near 32.70. Both Malaysia and Thailand are awaiting tariff/trade details from the US.
- USD/CNH is back under 7.2000, aided by the modest rise in the USD/CNY fixing (with the error term taking the bulk of Wednesday's USD gains). We did see softer PMI outcomes, but these didn't impact sentiment.
- USD/KRW is back under 1390, with the 15% trade deal outcome a positive in the broader context of Asian reciprocal tariff levels. USD/TWD is continuing to push higher, the pair now above 29.90. Like some parts of SEA, Taiwan is awaiting tariff/trade details from the US.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
LOOK AHEAD: UK Timeline of Key Events (Times BST)
Jul-01 05:23
| Date | UK | Period | Event |
| 01-Jul | 0930 | Jun | S&P Global Manufacturing PMI (Final) |
| 01-Jul | 1430 | ---- | BOE Bailey On Panel At Sintra Conference |
| 02-Jul | 1130 | ---- | BOE Taylor On Panel At Sintra Conference |
| 03-Jul | 0930 | Jun | Decision Maker Panel / Credit Conditions Surveys |
| 03-Jul | 0930 | Jun | S&P Global Services/Composite PMI (Final) |
| 04-Jul | 0930 | Jun | S&P Global/CIPS Construction PMI |
| 04-Jul | 1600 | ---- | BOE Taylor Speech On Natural Interest Rate |
| 05-Jul | 1645 | ---- | BOE Bailey On Les Recontres Economiques Panel |
| 09-Jul | 1030 | Q2 | BOE Financial Stability Report |
| 10-Jul | 1600 | ---- | BOE Breeden On Climate Change |
| 11-Jul | 0700 | May | GDP / Services / Production / Trade / Construction |
| 14-Jul | 0001 | Jun | KPMG/REC Jobs Report |
| 15-Jul | 0001 | Jun | BRC-KPMG Shop Sales Monitor |
| 15-Jul | - | ---- | Mansion House Speech |
| 16-Jul | 0700 | Jun | Consumer inflation report / PPI |
GBPUSD TECHS: Trend Sequence Remains Bullish
Jul-01 05:20
- RES 4: 1.3852 1.764 proj of the Feb 28 - Apr 3 - 7 price swing
- RES 3: 1.3835 High Oct 20 2021
- RES 2: 1.3800 Round number resistance
- RES 1: 1.3771 High Jun 26
- PRICE: 1.3740 @ 06:19 BST Jul 1
- SUP 1: 1.3632/3569 High Jun 13 / 20-day EMA
- SUP 2: 1.3426 50-day EMA
- SUP 3: 1.3328 Trendline support drawn from the Jan 13 low
- SUP 4: 1.3140 Low May 12 and key support
GBPUSD is trading at its recent highs. The trend needle continues to point north and last week’s climb reinforces bullish conditions. Fresh cycle peaks maintain the price sequence of higher highs and higher lows. Note too that MA studies are in a bull-mode position, highlighting a dominant medium-term uptrend. Sights are on 1.3800 next. Initial support to watch lies at 1.3569, the 20-day EMA. A break would signal scope for a corrective pullback.
JGBS: 10Y Leads The Market Richer After 10Y Auction
Jul-01 05:18
JGB futures are stronger, +23 compared to settlement levels, and hovering near session highs after today’s 10-year auction.
- This comes despite the 10-year JGB auction delivering only mixed to solid results. The low price beat expectations at 100.40, according to the Bloomberg dealer poll. However, the cover ratio decreased slightly to 3.5070x from 3.6627x, and the tail lengthened to 0.03 from 0.01, albeit the shortest since March 2023.
- Cash US tsys are 1-2bps richer, with a flattening bias, in today's Asia-Pac session, extending yesterday's bull-flattener. Today's US calendar: S&P Global US Man PMI, Wards Total Vehicle Sales, ISM Manufacturing, Construction Spending, JOLTS, Dallas Fed Services Activity.
- The Q2 Tankan survey delivered some positive upside surprises. The large manufacturing index rose to 13, versus 10 forecast and 12 prior. The outlook for this segment was also better than forecast, printing at 12 (9 was forecast and 12 was the Q1 outcome).
- Cash JGBs have reversed pre-10-year auction weakness to be 1-3bps richer across benchmarks, with the 10-year leading. The benchmark 10-year yield is 3.3bps lower at 1.399% versus the cycle high of 1.596%.
- Swap rates are flat to 1bp lower. Swap spreads are mixed.
- Tomorrow, the local calendar will see Monetary Base data.
