S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market
MUFG’s Lloyd Chan notes that the Korean Won (KRW) and Taiwan Dollar (TWD) are leading Asia FX gains as softer US yields and a resilient technology cycle support sentiment. In Indonesia, recent Indonesian Rupiah (IDR) stabilization may allow Bank Indonesia (BI) to keep rates at 5.75%, though a weaker trade balance and tight US Dollar (USD) liquidity warrant caution.
Tech-linked currencies outperform peers
“August price action thus far suggests that markets are becoming increasingly selective in their Asia FX outlook. The strongest gains were concentrated in KRW and TWD, pointing to investor preference for currencies leveraged to a softer US rates environment and a resilient global technology cycle.”
“Meanwhile, several ASEAN currencies have strengthened month to date despite Brent crude prices staying around $90/bbl, suggesting that lower front-end US yields are partly supportive of regional FX gains.”
“That said, any renewed surge in Brent prices would likely pose headwinds for the baht and peso – both of which are experiencing an economic slowdown.”
“In Indonesia, the recent rupiah stabilisation, partly helped by BI policy measures, is likely to give room for BI to keep the policy rate unchanged at 5.75% today.”
“But Indonesia’s weakened trade balance and still tight dollar liquidity conditions warrant caution on the rupiah’s outlook.”
