Summary of Key Points from Conference Call Industry Insights 1. Asia FX Volatility Strategies - Recommendations include selling USDCNH risk reversals, buying USDKRW puts, and selling USDTWD call spreads. [1][2] - Specific trades suggested: - Sell 6m USDCNH 25d RR at 0.25% and 1y USDCNH 25d RR at 0.55% [3][4] - Buy 3m USDKRW 1350 EKO at 33 bps [4] - Buy 3m USDSGD 1.24 digi put at 11.20% [4] - Sell 3m USDTWD 30.25/31.00 call spread for 46.3 bps [4] - Buy 1y 82 USDINR Digi Put at 9.2% [4] 2. Japanese Government Bonds (JGBs) - 30-year JGB yields have risen sharply, now above German bund yields, indicating a lack of demand for long-duration bonds [7][8][12]. - Concerns about Japan's fiscal position are growing, with calls for consumption tax cuts ahead of elections [7][8]. - The market is expected to see increased ultra-long inventories, but foreign demand remains weak [9][11]. 3. China Trade Optimism - Recent headlines suggest that US-China trade optimism may have peaked [15][19]. - G7 countries are discussing tariffs on low-value goods from China, which could negatively impact trade [16][17]. - China's response to US restrictions on Huawei chips has intensified, indicating a tougher stance [18]. 4. Taiwan Sovereign Wealth Fund (SWF) Implications - Taiwan's SWF aims to invest overseas to enhance government income and support national security and infrastructure [27]. - The SWF's launch is linked to Taiwan's involvement in the Alaska gas project, capped at 50% of an estimated US$44 billion investment [27]. - Potential funding sources for the SWF include government-issued bonds and fiscal surpluses [28]. 5. Hong Kong Dollar (HKD) Movements - The HKMA has noted recent strengthening of the HKD and discussed liquidity injections following the LERS trigger [32][33]. - The HKMA emphasizes that lower yields are beneficial for the Hong Kong economy, with low chances of intervention unless the HKD hits 7.85 [33]. Additional Important Insights - The CFETS index has shown volatility, reflecting US-China trade talk optimism followed by declines [26]. - The PBoC may resist large RMB appreciation to protect exporter margins and employment [20][23]. - Taiwanese exporters have been asked to limit daily USD sales, indicating central bank intervention in the FX market [29]. This summary encapsulates the critical insights and recommendations from the conference call, highlighting the current trends and potential impacts on the respective markets.