23 February 2018
Rates & FX View
Asia ex Japan FX: Good Times to Last?
Key Highlights
Highlights
¨ AxJ FX broadly took cues from the weaker USD over 2017 as well as benefitting from an improving economic landscape.
¨ We expect a higher bar for positive economic surprises over 2018 among AxJ economies, which could limit any incremental optimism on this front.
¨ Asian FX will likely be again dependent on global market sentiment and USD momentum over 2018, with carry plays and strategies remaining relevant over the coming months, although less pronounced. Expect focus to gradually shift towards fundamentals especially given the possible resurgent of volatility.
¨ Our core Asian FX views remain unchanged from our 2018 Annual Outlook piece dated 13 December 2017. MYR and IDR remain our favourite among AxJ FX over the coming months.
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