Last Friday’s nonfarm payroll number has brought a USD rally, with shorter term US yields surging off of lows around 0.195% on the 2yr Treasury, to around 0.216%. The subsequent equity rally puts Asia in good stead to start off the week. There has been a re‐coupling between Asian (ex‐Japan) stocks and global equity performance over the past month. Interestingly, that corresponds to the rebound in Asian currencies over that same timeframe. Confidence has returned, though we still note a deterioration in the economic data relevant to the trade sectors that may ultimately begin to cause a greater degree of activity in leaning against the wind for Asian central banks.
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Scotiabank