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Chinese stocks remain under pressure as the...>

CHINA
CHINA: Chinese stocks remain under pressure as the rally in the yuan fails to
translate into equity gains. This highlights the risks facing policymakers that
we have noted in recent weeks, namely that they may be forced to chose between
supporting the currency and supporting the equity market. Efforts to support one
asset are likely to come at the direct expense of the other. 
- H-Shares have outperformed in recent days, with the yuan's rally providing a
tailwind. The A-H Premium is now at 115.9.
- Rates are also under pressure with new cyclical lows seen in Chinese swaps all
the way up to the 5-year tenor, and the China-US 2-year swap spread now at
-12bps. 
- USDCNH trades at 0.8336.

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