NJA: USD/Asia uptrend still intact

Risk sentiment appears to have stabilized with markets going into a seasonally more favourable quarter in Q4. However, China growth concerns, Fed normalization and increasingly dovish regional central banks are likely to keep the USDAsia uptrend intact. In fact currency pairs such as USDTHB and USDSGD have continued to hit multi-year highs amid last week's relief rally. 

"Given the risks around the upcoming MAS policy review meeting in mid October, we added a 1m USD call SGD put RKO option recommendation", says Barclays.

In Korea: Near-term correction due in rates, as KRW depreciates, 02 October 2015, the KRW's particular vulnerability to China's slowdown, while BoJ easing in October adds new risks for the KRW given the close economic competition and currency correlation between the two countries. 

"In contrast, we continue to see INR remaining an INR outperformer, with the recent growth boost coming from a larger-than-expected rate cut and regulation changes to allow larger foreign inflows into INR debt", notes Barclays.

In terms of data releases, the focus this week will be on China's monetary data for September (Saturday). M2 growth is expected to moderate (last: 13.3%) while Total Social Financing (i.e., total credit growth) to expand ( last: CNY1082.3bn). India's exports likely contracted further on weak external demand and lower oil prices (last: -20.7%), while the trade deficit is likely to have narrowed due to a fall in gold imports (last: -USD12.5bn). Taiwan (Tuesday) and Malaysia's (Wednesday) export data for September and August respectively are expected to have contracted by 12%y/y and 2%y/y respectively.