Halister News

(Bloomberg) -- Malaysia’s ringgit tumbles over 1% on eve of the next 1MDB coupon bond payment. Philippine peso bucks regional losses in election relief rally after Duterte claims victory.

• South Korea’s won leads rest of Asian currencies lower as dollar index climbs for sixth day on prospects of Fed rate hike while PBOC weakens yuan’s reference rate to lowest since March 4
  • PBOC’s fixing today suggests a bias of not keeping yuan too strong; KRW, MYR as well as SGD could be vulnerable under such scenario, Khoon Goh, Singapore-based senior FX strategist says in interview
  • Expect market participants to price in Fed’s rate hikes going into policy meeting next month: Goh
• Ringgit falls to lowest level in 7 weeks as crude oil prices drop and following overnight rise in Dollar Index; 1MDB is due to make another bond payment on May 11, after defaulting on dollar-denominated bonds last month
  • USD/MYR may test 200-DMA if 1MDB saga drags on; break above 55-DMA suggests investors are moving out of ringgit exposure as 1MDB saga enters a new phase
• Peso lead gains among regional currencies after Philippines election holiday yesterday and Duterte claims presidential win
  • Hedge funds bullish on the Philippines after Duterte win
  • Peso’s advance may be driven by post-election relief rally, Macquarie Bank and Bank of Singapore say
• China’s April CPI rose 2.3% y/y, matching median est., unchanged from March
  • April PPI dropped 3.4%, smallest decline since Dec. 2014, vs median est. of 3.7% decrease
  • Anonymous “authoritative person” commented on People’s Daily to address changes the economy is facing, prognose L-shape recovery and call for structural reform
• Yen drops against dollar after FinMin Aso again warns that Japan can intervene to stabilize currencies if necessary
• Won declines; South Korean government says the recovery for domestic demand is weak, and external risks such as slowing global growth are persisting
• U.S. 10-yr Treasuries yield +1bp at 1.763%; Fed’s Kashkari says “there’s still slack in the labor market”