Back Sub 7.2100, Jan Inflation In Focus Ahead Of Last Trading Day Before LNY

USD/CNH spent most of the post Aisa close tracking higher. By the NY session we were close to 7.2150. We have dipped sub 7.2100 in early Thursday trade, after CNH lost 0.16% for Wednesday's session. USD/CNY ended at 7.1949, while the NEER (J.P. Morgan index) lost 0.12%, to be at 124.17.

• Locally today the main data focus will be on the Jan inflation prints. The market looks for slightly weaker CPI -0.5% y/y, versus -0.3% prior. The PPI is projected at -2.6% y/y, versus -2.7% prior.
• Note as well, this will be the last trading day before the kick off of the LNY holiday period, which runs from tomorrow until the end of next week, so onshore markets return on Feb 19.
• Late yesterday headlines cross of the China financial securities regulator being replaced (see this link for more details). This comes after the recent rout in onshore equities. To recap, the CSI 300 finished 0.96% higher in onshore trade yesterday. Northbound stock connect inflows continued, albeit down from the prior day's pace.
• In US trade on Wednesday, the Golden Dragon index loss 1.18%, after a 5.93% gain on Tuesday.
• The other focus point will be on CNH liquidity, with overnight CNH Hibor rates remaining elevated in Hong Kong.