Maybank FX Asia Weekly - 3 Feb 2016

      Regional currencies could get some respite ahead of the Lunar New Year celebrations next week, helped by the BOJ’s adoption of negative interest rates. Further help could come towards the end of the week as a weak US NFP is expected for Jan. China concerns have faded into the background as policy-makers there try to keep the economy and the CNY stable for the Lunar New Year celebrations at the very least. In the near term then, we could see relative AXJ strength vs. the USD and JPY.

      For the week after though, muted trades are likely given that much of Asia will be away for the Lunar New Year celebrations that begins on 8 Feb. China and Vietnam will be away for the week, while Singapore, Malaysia, Indonesia, Philippines and Korea will be closed between 1-3 days for the celebrations. Thus, range-trading is likely ahead.

      This week, key events to watch out for are BoT’s first policy meeting of the year on Wed, which is expected to be a non-event; and Indonesia’s 4Q GDP. The following week has BSP meeting for the first time as well on Thu (11 Feb) but no adjustments are expected. Thailand and India release their GDP prints for 4Q in the week of 8 Feb and the data will be scrutinise for signs of a pick-up. Unless policy makers in Thailand and Philippines surprises, we do not expect any significant impact on the THB and PHP.