• Top 3 data/events 28 April 2014
• Japan – BoJ likely to stay put; industrial production likely rebounded
• South Korea – IP backed by strong exports
• Euro area – Rise in April CPI may alleviate policy-action pressure
• Market focus
Broad USD weakness, technicals and positioning could support the THB further near-term
• Real-money funds are underweight Thai local markets; as they cover their shorts, THB could rally further
• Fundamentally, we like this trade and will look to...
• Near-term, the market will focus on the sharp rise in UST yields and the risk of the Fed tapering QE3
• The SGD NEER may trade into the weak half of policy band; SGD to underperform G3
• We stand aside for now on the SGD given market volatility...
Today, the BoT said that the THB has appreciated too much and too quickly
• We believe that USD-THB may rebound near-term given this strong warning and positioning
• Fundamentally, we like this trade and will look to re-enter it at better levels...
Our sensitivity indicator of yield vs. positioning is falling; EM/DM yield spreads to widen near-term
• Within EM, low-yielding bonds to outperform high-yielding as the sensitivity of positioning to yields falls
• Investors should keep exposure to...
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