Asia FX Update: Watch INR
(1 min read)
Markets are starting to come to terms with a COVID world and Asia FX is no different. After tumbling in March, most Asia FX stabilised over the last month (Chart 1). INR has strengthened against the dollar, SGD and TWD are flat, while CNH and KRW are down. The strength in INR is notable as it comes in the face of a generally strong dollar - the DXY is up over the past month.
DXY and Global Equities Still an Important Driver of Asia FX
That said, most Asia FX is still correlating strongly with broader equity and dollar trends. So, understanding that backdrop is key. The picture is unclear on the dollar as the Fed remains extremely dovish, but investors are finding it a safe haven in an uncertain world.
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