CNH & Equity Sentiment Stabilize, But NEER At Fresh YTD Low, Official PMIs On Tap Today

USD/CNH couldn't pierce the 7.1100 late in Asia Pac/early European trade on Tuesday. Dips in the pair back towards 7.0850 were supported, but we couldn't get back above 7.1000 in NY trade, the pair currently sits in the 7.0910/20 region. USD/CNY closed just under 7.0800 for Tuesday's session, while the CNY NEER (J.P. Morgan index) fell -0.38% to 123.38, a fresh low back to Nov last year.

• Bloomberg noted state owned banks were USD buyers late yesterday (a switch from recent sessions) but profit taking emerged as USD/CNY approached 7.1000.
• CNH was also aided by the rebound in onshore equities with the CSI 300 rebounding late to close +0.10% higher, after printing fresh YTD lows sub 3800 in the first part of the session. Northbound stock connect flows ended Tuesday's session modestly firmer (+0.65bn yuan). The Golden Dragon index was weaker in US trade though, losing 2.96% for Tuesday's session.
• Elon Musk met with China's Foreign Minister Win Gang on Tues and emphasized the importance of maintaining ties with China.
• Coming up today is the official PMI prints for May, the market consensus looks for modest improvement in the manufacturing outcome, 49.5 is the consensus versus 49.2 prior. The non-manufacturing PMI is forecast at 55.2, versus 56.4 prior. See this link for more details.