Asia Open - Overnight Highlights

EMERGING ASIA

EM currencies perform mostly weaker against the USD as the greenback gained strongly on other dovish central bank rate decision and outlook, along with falling equities and higher yields. IDR saw the largest losses of 0.4%, followed by SGD and THB 0.27%, INR 0.23%, KRW 0.21%, CNH 0.13%, MYR 0.06%, CNY 0.05% and PHP 0.02%.

USD/CNH is trading higher at 7.2910 from 7.2813 previously closed. Onshore spot USD/CNY is trading higher at 7.2604 than 7.2570 previously closed. 12 month NDF followed both the on/offshore market and is trading higher at 7.0688 compared 7.0579 to previously closed.

USD/IDR spot market is trading higher at 16430 from 16365 previously closed. 1 month NDF is trading higher at 16507 from 16401 previously closed.

USD/INR onshore spot market is trading higher at 83.64 than 83.45 previously closed. 1 month NDF is trading higher at 83.70 than 83.50 previously closed.

NA Session

The BoE left rates unchanged as expected with a 7-2 vote, but the markets saw the statement as dovish boosting the probability of an August rate cut, with higher than expected service inflation seen as respecting factors that would not push up medium term inflation. EUR/GBP bounced above .8450 while GBP/USD slipped below 1.27, later extending to 1.2660 as the USD advanced broadly.

US data was softer than expected with initial claims seeing only a modest correction from last week’s sharp rise, housing starts and permits falling, the Philly Fed less positive and the current account deficit wider. However the USD dip on the data was brief as UST yields picked up, perhaps noting stronger price indices within the Philly Fed breakdown. USD/JPY led the way advancing to 158.90 while EUR/USD fell to near 1.07. AUD/USD however fell only marginally and USD/CAD fell below 1.37.