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CNH Firms On Tighter Liquidity

CNH

USD/CNH is tracking close to fresh lows, the pair last near 7.2900 (session lows sit at 7.2871). The pair is bucking the generally firmer USD trend against the majors. We also haven't seen the weaker onshore equity tone weigh materially yet either. A further move higher in CNH implied yields is helping though, amid on-going liquiity pressures.

  • The 1 week sits at 5.62%, fresh highs back to August 22, while the 1 month is near 5.10%, also fresh highs back to August 22. T/N points sit at 4, elevated but below August highs.
  • The move lower in USD/CNH has us once again sub the 20-day EMA (closer to 7.2940), but the earlier September dip sub this support level didn't prove sustainable. Earlier September lows were just under 7.2400.

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