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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
CNH continues to lag broader USD moves today. The BBDXY is down around 0.30%, versus CNH's gain of 0.20% against the USD. The beta was even lower yesterday, CNH up the same amount versus the USD, but the BBDXY down 0.70%. USD/CNH sits close 7.1950 currently, yesterday we saw support emerge close to 7.1900 region.
- EUR/CNH also appears to have made a definitive break above the 200-day MA, see the chart below. The pair hasn't been meaningfully above this level since late 2020.
- Whether or not we stay above this level may ultimately depend more on EUR performance, particularly as we head toward the northern hemisphere winter.
- Still, given reduced upstream price pressures in China, as signified by last week's PPI, coupled with questions still hanging over the growth outlook, further downside in the CNY NEER may materialize if we see a further broad based pull back in the USD. Easier financial conditions may be needed to support the growth outlook.
Fig 1: EUR/CNH Holding Above the 200-day MA
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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