Global Markets Daily: NJA FX/Rates Trade Ideas Amid the Shifting Winds of AI, Energy and Rates

AI-related investment, energy and US yields have been the three key external drivers of Asian macro markets this year. Given the ebb and flow in prices of AI-related assets over the past few weeks and the rise in energy prices (Brent up to US$115/bbl from US$100/bbl a month ago), we refresh our views on existing trade recommendations and tighten stops to protect potential gains. We maintain: Receive KRW 2Y IRS (entry 3.97%, current 3.73%, target 3.60%, revised stop 3.97%), as we expect the BoK to hike just once more to 3.25%, more dovish than market pricing of 2-3 hikes, with around 5bp of positive carry per month; long INR/IDR (entry 187, current 191, target 200, revised stop 188), as the IDR faces equity outflow risks from MSCI's proposed reclassification of Indonesia to Standalone status and narrowing rate differentials versus the US, while the RBI has US$700bn+ of gross FX reserves;