Overnight Price Action
Risk rallies ran out of steam at the end of the week with most Asian equity and currencies down. The Nikkei fell 0.4%, Heng Seng lost 0.5%, ASEAN markets were 0.2% to 0.4% lower while S&P futures were flat. With the exception of the SGD and TWD which rose marginally, the rest of EM Asian currencies were down 0.1% to 0,3%. USDINR gapped higher to 61.94 on the open. USDPHP also rebounded to 43.17, and USDKRW to 1072 on suspected BoK intervention. USDMYR inched higher to 3.20 on the open but later reversed to 3.192 after a better–than-expected trade surplus.
US 10y yield edged higher to 2.62 in Asian trading, having recovered from a low of 2.58% in late NY time. However, the USD failed to gather strength in G10. EUR held gains at 1.362 and JPY was little changed at 97.23, uninspired by an unchanged BoJ. AUD rallied to 0.944 as pricing for RBA cuts over the year ahead dropped to a low of 3bps from 7bps on the open. Rate spread also drove AUDNZD higher to 1.137.
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Credit Suisse