EM ASIA CREDIT: PTTEP Treasury (PTTEPT, Baa1/NR/BBB+) - Thai plans on tariffs

USD/JPY has ticked up from earlier lows, the pair last 151.60/65. Earlier lows were at 151.24. Modest yen weakness so far today is consistent with trends elsewhere in the G10 FX space, with the USD BBDXY ticking up around 0.10% in latest dealings.

• Tech wise for the pair little is changed. Key support and the bear trigger is unchanged at 150.93, the Feb 7 low. Clearance of this level would resume the bear cycle that started on Jan 10. Resistance around the 50-day EMA, remains intact. The average is at 154.36. A clear break of the 50-day average is required to highlight a stronger bullish reversal.
• Earlier lows in USD/JPY coincided with remarks from Finance Minister Kato, who stated yesterday's GDP data pointed to bright signs for the economy (per BBG).
• US-JP yield differentials are relatively steady, but remain close to recent lows, the 10yr spread last near +310bps. US Tsy markets have re-opened with a slightly firmer US yield bias. Market implied rates for the BoJ July meeting sit close to 0.70%, so close to another hike fully priced by then.
• The local data calendar just has Tokyo condominium sales on tap today. Tomorrow, we have BoJ speech (from Takata) along with trade figures and core machine orders. 

Taiwan saw a total reversal of Friday's large outflow on Monday, while Thailand saw a large inflow. India continues to see heavy selling from foreign investors with an almost $11.5b ytd outflow

• South Korea: Recorded -$112m in outflows on Monday, bringing the 5-day total to +$1m. YTD flows remain negative at -$1.48b. The 5-day average is $0m, better than the 20-day average of -$74m but worse than the 100-day average of -$124m.
• Taiwan: Posted +$766m in inflows on Monday, bringing the 5-day total to +$311m. YTD flows remain negative at -$2.36b. The 5-day average is +$62m, better than the 20-day average of -$114m and the 100-day average of -$44m.
• India: Recorded -$578m in outflows on Friday bringing the 5-day total to -$2.13b. YTD outflows remain heavy at -$11.44b. The 5-day average is -$425m, worse than the 20-day average of -$324m and the 100-day average of -$229m.
• Indonesia: Posted +$66m in inflows on Monday, bringing the 5-day total to -$61m. YTD flows remain negative at -$580m. The 5-day average is -$12m, worse than the 20-day average of -$19m and the 100-day average of -$29m.
• Thailand: Saw +$138m in inflows on Monday, bringing the 5-day total to +$105m. YTD flows remain negative at -$152m. The 5-day average is +$21m, better than the 20-day average of +$4m and the 100-day average of -$17m.
• Malaysia: Registered -$43m in outflows on Monday, bringing the 5-day total to -$89m. YTD flows are negative at -$828m. The 5-day average is -$18m, better than the 20-day average of -$25m but worse than the 100-day average of -$28m.
• Philippines: Recorded -$17m in outflows on Monday, bringing the 5-day total to -$53m. YTD flows remain negative at -$146m. The 5-day average is -$11m, worse than the 20-day average of -$3m and the 100-day average of -$4m.

Table 1: EM Asia Equity Flows

In Tokyo morning trade, JGB futures are weaker, -7 compared to settlement levels, but well above overnight closing levels.

• According to MNI’s technicals team, a clear downtrend in JGB futures firmed further on the strong GDP print, with the latest fresh cycle lows reinforcing the condition. Note too that MA studies on the continuation chart are in a bear-mode setup, highlighting a clear downtrend. The 140.00 psychological handle has been pierced, and markets have shown through 139.38, a Fibonacci projection. For bulls, a reversal would open 142.73 and 144.48, the Dec 9 and Nov 11 high respectively. Gains would be considered corrective.
• “Japan will study details of US President Donald Trump’s auto tariff measures as they become clear, examine the impact on Japan and respond appropriately, Trade Minister Yoji Muto says at a regular press conference.” (per BBG)
• Cash US tsys are flat to 2bps cheaper, with a steepening bias in today’s Asia-Pac session after yesterday’s holiday.
• Cash JGBs are little changed across benchmarks. The benchmark 20-year yield is 0.3bps higher at 2.02% ahead of today’s supply.
• Swap rates are flat to 1bp lower, with swap spreads tighter.