Asia Open - Overnight Highlights

EMERGING ASIA

EM currencies perform mostly weaker against the USD as the greenback remains back and forth on the ebb and flows of tariff headlines. The only winners are MYR by 0.09%, followed by PHP 0.03%; while the largest losers are THB 0.29%, INR 0.17%, SGD 0.15%, KRW 0.14%, TWD 0.12%, IDR & CNH 0.1%, CNY 0.07% and HKD 0.01%.

USD/CNH is trading higher at 7.2441 from 7.2366 previously closed. Onshore spot market is trading higher at 7.2418 from 7.2369 previously closed. 12 month NDF diverged from both the on/offshore market and is trading lower at 7.0755 compared to 7.0771 previously closed.

USD/IDR spot market is trading higher at 16330 from 16313 previously closed. 1 month NDF is trading higher at 16345 from 16293 previously closed.

USD/INR onshore spot market is trading higher at 87.11 from 86.96 previously closed. 1 month NDF is trading higher at 87.34 from 87.07 previously closed.

NA Session

EUR/USD picked up after the as expected 25bps ECB easing with limited forward guidance raising doubts about the scope for further moves. From slightly below 1.08 EUR/USD peaked slightly above 1.0850, before eventually returning to levels seen before the decision. 

Comments from Commerce Secretary Lutnick that tariffs on USMCA goods from Canada and Mexico would be delayed by a month triggered a sharp slide in USD/CAD from near 1.4350 to near 1.4250. Trump confirmed this for Mexico, and later for Canada. As markets waited for the Canada confirmation USD/CAD crept back to 1.43. A bounce in equities on the Lutnick comments also faded, as did a bounce in USD/JPY above 148. Confirmation of the Canada delay got only a limited response. Trump stated there would be no USMCA exception for autos in April.  

US initial claims corrected a preceding sharp rise falling to 221k from 242k. The US recorded a record trade deficit in January while Canada’s trade surplus increased in an attempt to beat threatened tariffs.