USD/CNY: 1Y NDFs saw a mild recovery from the low of 7.0765 in the NY hours and traded on either side of 7.0900. The PBoC restarted reverse repurchase agreements on the day, and CNY was correspondingly offered. Onshore spot traded to a high of 6.8910 after the higher midpoint fixing of 6.8898. USDCNY likely to be caught within the two forces of tightening liquidity and medium term worries. 1Y NDF points might have rebounded to near 25 big figures, but we still look for opportunities to buy at near 20 big figures levels.
USD/CNH: Pair saw a dip to 6.8465 in the European hours but a quick recovery above 6.8500 was noted, with the pair trading higher to >6.8600 levels as the dollar was boosted by a hawkish Yellen. Although we expected the CNHCNY spread to go back into positive this week, agent bank machinations showed that a >1 big figure spread was maintained in the day. Traders placing their bets on a positive spread would do well to come back in the latter half of the week, or even next week.
USD/SGD: Despite a sell-off into the European session to a low of 1.4156, prices recovered in NY with gains in the dollar index and inched back above the 1.4200 handle. Likely potential for gains to extend beyond the 1.4250 figure on Yellen, but some downside pressures are likely into the end of the week with expectations of an expansionary Budget next week. Support at 1.4150 should however remain intact.
USD/IDR: 1M NDFs saw steep gains to 13407 on Yellen testimony but a quick retreat to near-13350 levels was also noted. Onshore spot traded firmly around 13330 in the morning before turning a tad lower below 13325 in the afternoon as the dollar index weakened. Trading however remained thin ahead of the Jakarta governor elections on Wednesday and BI decision due on Thursday. Gains to 13400 are likely in case protests are seen during the elections, which seems unlikely. Focus on Fed Yellen's testimony later today, but markets remain closed on Wednesday for local elections.
USD/INR: 1M NDFs slipped to 66.9400 before Yellen's comments ignited a rally in dollar taking prices up to 67.1200 only to retreat again later. Onshore spot gapped slightly lower to open below the 67 handle at 66.9700 vs. last close of 67.0150, shrugging off any impact from the record low Jan CPI print reported on Monday night. Pair continued to trade around 66.9500 in the day, but some upside is likely today, and eyes will be on 67.2000.
DATA RELEASED TODAY MORNING AND DUE TODAY
- n/a GMT - ID: Exports (Jan) 4cast:19 % y/y [Prev: 15.57]
- n/a GMT - ID: Imports (Jan) 4cast:10 % y/y [Prev: 5.82]
- n/a GMT - ID: Trade Balance (Jan) 4cast:959 USD mn [Mkt: 853, Prev: 992]
- 00:30 GMT - AU: New motor vehicle sales (Jan) [Prev: 0.3]
- 05:00 GMT - SG: Retail Sales (Dec) 4cast:1.4 % y/y [Mkt: 1.4, Prev: 1.1]
- 05:00 GMT - SG: Retail Sales (sa) (Dec) 4cast:-2.2 % m/m [Mkt: -1.9, Prev: 0.5]
- 08:00 GMT - TW: GDP (Final) (Q4) [Mkt: 2.6, Prev: 2.58]
- 09:30 GMT - UK: Average Earnings (incl. bonus) (Dec) 4cast:2.8 % 3m y/y [Mkt: 2.8, Prev: 2.8]
- 09:30 GMT - UK: Claimant Count Change (Jan) 4cast:1 k [Mkt: 1, Prev: -10.1]
- 09:30 GMT - UK: Claimant Count Rate (Jan) 4cast:2.3 % [Mkt: 2.3, Prev: 2.3]
- 09:30 GMT - UK: ILO Unemployment Rate (Dec) 4cast:4.8 % [Mkt: 4.8, Prev: 4.8]
- 10:00 GMT - EU: Trade Balance (sa) (Dec) [Mkt: 22, Prev: 22.7]
- 13:30 GMT - US: CPI (Jan) 4cast:0.4 % m/m [Mkt: 0.3, Prev: 0.3]
- 13:30 GMT - US: CPI (ex Food & Energy) (Jan) 4cast:0.3 % m/m [Mkt: 0.2, Prev: 0.2]
- 13:30 GMT - US: Empire State Survey (Feb) [Mkt: 7, Prev: 6.5]
- 13:30 GMT - US: Retail Sales (Jan) 4cast:0 % m/m [Mkt: 0.1, Prev: 0.6]
- 13:30 GMT - US: Retail Sales (ex Auto) (Jan) 4cast:0.5 % m/m [Mkt: 0.4, Prev: 0.2]
- 13:30 GMT - CA: Manufacturing sales (Dec) 4cast:0 % m/m [Mkt: 0.3, Prev: 1.5]
- 14:15 GMT - US: Capacity utilisation (Jan) 4cast:75.4 % [Mkt: 75.5, Prev: 75.5]
- 14:15 GMT - US: Industrial production (Jan) 4cast:0 % m/m [Mkt: 0, Prev: 0.8]
- 15:00 GMT - US: Business inventories (Dec) [Mkt: 0.4, Prev: 0.7]
- 15:00 GMT - US: NAHB Builders survey (Feb) [Mkt: 67, Prev: 67]
- 21:00 GMT - US: Net Long-term TICS Flows (Dec) [Prev: 30.8]
EVENTS & AUCTIONS
- 15:00 GMT - US: Fed's Yellen Speaks in Washington
- 17:00 GMT - US: Fed's Rosengren Speaks in New York
- 17:45 GMT - US: Fed's Harker Speaks in Philadelphia
- 22:00 GMT - AU: RBA's Ellis Speaks
- 23:00 GMT - NZ: Finance Minister Joyce Speaks