CNH Underperforming Amid Multiple Headwinds

(MNI Australia) USD/CNH currently tracks just below Friday session highs, last around 6.9775, with some resistance evident above the 6.9800 level through the tail end of last week. CNH lost nearly 1% for Friday's session. The pair is above all key EMAs, while the simple 100-day MA sits at 6.9970. The CNY NEER (J.P. Morgan Index) lost further ground, now sitting back at 125.51, down around 0.50% for last week.

• The yuan suffered from broad based USD strength, as yield momentum remained stronger post the stronger than expected PCE print.
• US-China tensions remain the other headwind for CNH. The US Commerce Department sanction 5 China related entities on Friday for contributions to Russia's military. US officials have repeatedly stated there would be serious consequences if China supplies significant military equipment to Russia.
• The Golden Dragon index lost 3.86% through Friday's session, with earning concerns in the sector also weighing. The index has lost ~17% from its early Feb peak.
• The data calendar remains quiet until Wednesday when official PMIs are due. The PBoC reiterated late on Friday that it will keep monetary policy prudent and targeted.