• Asia: In February, our clients were large USD sellers vs. CNY and MYR; USD buyers vs. CNH, THB, TWD
• Asia: Our custodian clients were sellers of USD vs. SGD and INR; buyers of USD vs. CNH, HKD and THB
• Asia: Short USD positioning is large vs. ...
• In January, our clients were large USD sellers vs. CNY and MYR; large USD buyers vs. IDR, TWD, CNH
• Our custodian clients were sellers of USD vs. INR and CNY; buyers of USD vs. CNH, TWD and PHP
• Short USD positioning is large vs. KRW, INR and ...
We update our PCA for AXJ currencies; rise in US IP cycle is countered by the fall in China’s IP cycle
• Indonesia’s exports and trade balance have improved substantially, in contrast with recent IDR sell-off
• Widening MYR-USD rates spread shoul...
We expect further remittance growth on a recovery in global growth and post-typhoon reconstruction
• Our models therefore estimate c.2.0-2.5% more support in 2014 than in 2013
• We expect remittance growth to remain positive for GDP growth, curren...
In September, our clients were large USD sellers vs. PHP, TWD and INR; large USD buyers vs. IDR
• Our custodian clients were large sellers of USD versus PHP and TWD; substantial buyers of USD-IDR
• Short USD positioning is now substantial vs. PHP,...
In August, our clients were sellers of USD versus KRW, CNY, INR; buyers of USD versus THB, IDR, PHP
• Our custodian clients were sellers of USD versus KRW; substantial buyers of USD versus THB and PHP
• Short USD positioning is now substantial ver...
We update our PCA for AXJ currencies; the rise in the global IP cycle should support AXJ FX in Q4
• We get positive PCA signals for TWD, PHP and IDR; neutral for other AXJ currencies
• We raise our short-term FX weightings on SGD and THB to Neut...
We see the Philippines as having the strongest fundamentals in Asia on growth, CA, fiscal consolidation
• Elevated NEER and equity outflows to weigh on TWD near-term
• Forward points, levels and seasonal factors make it attractive to sell TWD-PHP ...
SC FIRST gives direction, spread and relative-value signals for EM bonds
• We get a negative direction signal for EM bonds on fund outflows, bond selling and negative FX outlook
• New this month: We estimate EM-fund cash levels and flows to help o...
PCA confirms that growth is the key driver of AXJ currencies, followed by carry and USD-CNY fixings
• China’s IP cycle leads KRW, TWD, IDR and MYR; local IP cycle is important for INR and TWD
• Recent drop in global and local IP cycles to weigh o...
Recent weakness in Philippine data and potential further SDA adjustments to weigh on PHP near-term
• Rich valuations in the PHP and local asset markets to weigh on PHP in Q2
• We look to re-buy PHP in H2 when PHP appreciation should resume on stro...
The Post Today reported that the BoT may introduce a holding period for foreigners buying THB bonds
• We believe a price-based approach to FX measures would be less market-disruptive than quantity-based
• We take profit on our long 10Y THB positi...
Top 3 data/events
• Japan –Trade deficit likely continued in February
• UK – Retail sales may have crept up in February, but remain fragile
• US – The FOMC is expected to sit tight
• Market focus
• SCTF and SC FIRST suggest that positioning ...
• We are bullish on the PHP on strong growth, solid C/A balance and rating upgrade expectations
• Our Standard Chartered Transaction Flows indicate clients were net long USD-PHP as of end-February
• Onshore, our Philippine clients are very bullis...
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...
We expect a larger current account surplus in 2013, supported by services exports and remittances
• The BoP backdrop provides a strong argument for an investment-grade rating by 2014
• We maintain our Overweight stance on the PHP, although we expe...
The Philippines may introduce further capital-flow measures to cap the PHP’s rise near-term
• These measures are unlikely to reverse PHP trend appreciation, but they are likely to slow its speed
• Fundamentally, we remain bullish on PHP medium-ter...
SC FIRST is based on novel, deep, on-the-ground insight into foreign investor activity in EM bonds
• Our dataset of foreign holdings of GBI-EMGD local debt is USD 484bn, 4x the size of EPFR data
• We quantify three different investor types and us...
We are bullish on the PHP on strong growth, solid C/A balance and investment-upgrade expectations
• Our Standard Chartered Transaction Flows indicate clients were net long USD-PHP in early January
• Onshore, our Philippine clients are very bullis...
Our SCTF Position Index shows clients remain substantially short USD vs. MYR; long USD vs. IDR, CNH
• Clients overall boosted USD shorts in December vs. MYR, TWD, SGD; reduced shorts vs. CNY, KRW, INR
• Custodian clients are substantially short US...
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The world economy is in transition. Global growth rates are picking up, but transition means elevated risks and volatility.
In terms of global implications, all eyes will be on the US and China, with the US normalising monetary policy and China rebalancing its economy.
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