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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CNH
USD/CNH spent most of the post Asia close range bound, centered around the 6.8800 level. We currently track just above this level, with CNH basically flat for Tuesday's session as a whole, underperforming softer USD tones elsewhere. The CNY NEER slipped 0.17% to 125.28 (J.P. Morgan Index) reversing some of the +0.65% gain seen in the previous two sessions.
- The lack of positive momentum post yesterday's Q1 GDP surprise (the low in USD/CNH came in just under 6.8650) likely reflected the mixed nature of the March monthly activity prints, with weaker than expected outcomes in IP, and property related investment likely weighing.
- The local data calendar is quiet now outside of March FDI figures due between now and the end of the week.
- Note US Treasury Secretary Yellen will speak on US-China economic ties on Thursday, see this link for more details.
- Onshore equities managed to finish modestly higher yesterday, +0.30% for the CSI 300. Northbound stock connect flows were positive, +2.26bn yuan. The Golden Dragon index fell slightly in US trade, but this follows a +3.18% gain on Monday and the index remains above its 200 day MA.
- Still, CNH is lagging the generally positive onshore equity backdrop, see the chart below. The degree of outperformance against the rest of the world, in terms of equities, has been more muted though, which has likely constrained CNH trends.
Fig 1: USD/CNH (Inverted) Versus CSI 300
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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