The Global Macro Pulse

A bounce of profit taking and concerns on China big banks’ debt write-offs caused heavy equity selloffs. The Nikkei reverted to a 1% loss as USDJPY dipped to 97.44. Shanghai and Shenzhen composites have fallen 1% to 2%. Kospi is now down 0.7% and S&P futures are off 0.2%. AUD spiked to a high of 0.975 following higher-than-expected inflation but has since been sold down to 0.967. EUR held onto gains at 1.378 but upside momentum has waned. Most Asia FX has rallied on the open but has since pared those gains. IDR appeared to run into BI resistance around 11300 levels and BoK continued to be seen. USDINR is now trading at 61.28, USDMYR at 3.156 and USDKRW at 1057.

In rates, China’s 7 day repo rate has spiked 44bps higher to 4.02%. US 10y yield took another small dip to 2.49%. Asian yields largely followed the US lower.