Chinese assets are trading at their daily.....>

CHINA: Chinese assets are trading at their daily lows across the board with

stocks giving back most of yesterday's gains as the CSI300 loses its grip on the

3200 level to return the focus to Friday's lows. 

- Equity weakness is keeping Chinese interest rate swaps under downside

pressure, with the 2-year trading at new 2-month lows at 2.84%, down 4bps on the

day. The curve is also seeing some flattening pressures with the 10-year down

6.5bps on the day. 

- The combination of risk off-driven upside pressure on the dollar and lower

Chinese rate is keeping USDCNH bid, but the pair remains below the 6.95 level

which is acting as resistance. A break back above this level risks triggering

another round of weakness across Chinese assets, which would likely be met with

further action from policymakers to stabilize markets.