PHP: USD/PHP Prints Fresh Highs Back To Early Dec 2022
Early impetus for USD/PHP is to the topside. We quickly pushed towards 56.40, and sit just below this level currently and this compares with closing levels of 56.225 yesterday. We are comfortably above the simple 200-day MA (around 56.10/11), with dips sub this level and just below 56.00 drawing support in recent sessions.
- The pair is now back to levels from early December last year. Highs from July last year near 56.50 may also some resistance, beyond that lies the 57.00 figure level.
- There doesn't seem to be a sharp pushback from the authorities around recent FX weakness. March BoP data still showed a decent surplus, while BSP FX reserves have mostly been trending higher since troughing in September last year.
- FX intervention/jawboning on the FX rate seem the main risks to the current uptrend for USD/PHP. The recent low in USD/PHP coincided with the trough in US real yields, see the chart below.
Fig 1: USD/PHP Versus US Real 10yr Yield
Source: MNI - Market News/Bloomberg
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USD: Citi: Long USD Positioning Still Dominant
Citi’s quant team note that their weekly positioning indicator reveals that “long USD positioning is still dominant. Investors increased their USD exposure slightly last week moving the CitiFX Positioning Indicator up to +5.7 (out of max long +10). However, positioning is still only about 50% of the largest net USD exposure we have seen in the past year.”
AUD: A$ Down Following RBA Minutes Mention Pause To Be Discussed In April
AUDUSD is 0.3% lower following the RBA’s March minutes, which mentioned that a pause will be discussed at the April meeting and will depend on the data and global developments. AUDUSD has broken through 67c and is around 0.6699, after reaching an intraday high of 0.6726. The USD index is trading sideways.
- See commentary on RBA minutes here.
- Aussie weakened against the major crosses following the minutes. AUDNZD is down 0.1% to 1.0743 and AUDJPY is 0.5% lower to around 87.82. AUDEUR is -0.3% to 0.6248.
- The ASX is up 1.2%, the Hang Seng +0.6% and the KOSPI +0.6% following a strong session in the US and Europe. The S&P e-mini is up 0.1%. Brent is down 0.4% to $73.53/bbl. Iron ore is around $126.50.
- Later ECB President Lagarde speaks and on the data front there is only Canadian CPI and US existing home sales for February.
CNH: CNY Fixing - Leaning Modestly Against Depreciation Pressures
The USD/CNY fix printed at 6.8763, versus a Bloomberg consensus of 6.8798.
- Today's outcome represents a -35pips surprise in USD/CNY terms, following yesterday's -14pip outcome. This has seen the rolling 5-day sum of the fixing error widen to -70pips.
- Today's fixing surprise is the largest downside surprise since 8th March.
- This indicates a modest lean against depreciation pressures.
- USD/CNH has firmed a touch in the first part of dealings, last around 6.8810/15, around +0.10% above NY closing levels. The USD is firmer against the G10 (ex JPY).
