NAB’s Non-rural Commodity Price Index declined in Q2
Insight
We think Asian currencies are likely to still be tethered to the RMB, which is still likely to be subject to the authorities’ allowing of corporate outflows to dominate.
The Lunar New Year holidays allowed market participants to take a breather, but most probably held their breath in anticipation of more turbulence after the holidays. We have closed out all our Asian FX trade recommendations (long USD/KRW, long USD/SGD and short USD/INR) on reduced confidence in the USD’s initial strength and the ongoing uncertainties surrounding China. It may require a leap of faith to look beyond the mixed and confusing market signals but for now, fear looks to be the monkey on the market’s back and we prefer to stay nimble and neutral in the Asian FX space.
Key highlights:
For full analysis, download report: Essential Asia: The Monkey’s First Leap (PDF, 1 KB)
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