NJA: Asia FX to find little cheer from macro data

China's real activity data (Wednesday) will be closely watched given its broad-reaching effect on EM growth and commodity prices. China's IP is expected to slip to 6.4% y/y (consensus: 6.6%; last: 6.8%) following the weak PMI production index, although FAI is likely to hold steady given the stabilization of infrastructure and real estate investment (consensus: 11.5%). M2 growth is expected to edge down given the possible capital outflows in July, but credit growth is likely to drop notably because of seasonality (Monday; last: 11.8%). Meanwhile, the IMF has said that significant work is still needed for the yuan's inclusion in the SDR, although the tone of its report suggests that it is within reach. 

In Indonesia, a slightly stronger trade surplus is expected in July, but the current account deficit for Q2 is likely to widen significantly due to seasonality (Last: USD-3.8bn). In Q2, BI stepped up intervention to slow the IDR's fall, but a senior BI official has hinted that the central bank is ready to slow intervention to "conserve foreign-reserves ammunition to manage the currency" (Bloomberg). Considering this, the move higher in USDIDR could accelerate in coming month as the Fed tightens, after having lagged the rest of USDAsia crosses in Q2. 

Sentiment toward the MYR is likely to remain poor as the currency slides to post-1998 lows after authorities stepped back from FX intervention. Q2 GDP is expected to soften (Thursday; consensus: 4.6%; last: 5.6%y/y) because of a post-GST consumption slowdown, while the Q2 current account surplus is likely to narrow (Last: MYR10bn). 

"In Korea, we expect the BoK (Thursday) to keep rates unchanged at 1.5% (consensus: unchanged)," says Barclays.