CNH Outperforms, PMIs On Tap Today

CNH spent much of the post Asia close on the front foot. Resistance was seen in USD/CNH ahead of the 7.1900 level, while in NY trading we dipped sub 7.1400. We stabilized somewhat into the close and currently track around the 7.1430 level. CNH gained nearly 1.50% through Tuesday's session, while the NEER rebounded by 0.70%.

• The China health commission vowed to speed up vaccination of the elderly late yesterday, while also stating local authorities should reduce the inconvenience caused by outbreaks and respond to requests from the public (around Covid issues) in a timely manner.
• This latter point looks to be aimed at reducing tensions following weekend social unrest.
• The market may continue to position for re-opening related plays, although there is still plenty of potential for bumps along the way.
• Overnight the China Dragon index gained over 5%, following Monday's +2.83% gain. The FT also reports that China will engage with Alibaba and Tencent to help overcome US semiconductor curbs.
• Today the main data focus will be the official PMI prints for October, with both measures expected to deteriorate further (see this link).