CNH Underperforms Weaker USD Indices, Industrial Profits On Tap Today

CNH underperformed weaker USD indices through Wednesday's session. USD/CNH continued to find selling interest above 7.1600 post the Asia close, but couldn't sustain moves sub 7.1500. We currently track at 7.1510//20, with CNH down 0.22% for Wednesday's session. USD/CNY finished up lower at 7.1430, but the CNY NEER (J.P. Morgan index) still gave up some recent gains, down 0.34%.

• Major dollar indices finished 0.25-0.30% weaker post the Fed/Powell press conference outcomes, with slightly weaker US yields weighing. The US-CH 2yr government bond yield spread has edged down from recent highs (-10bps), last near +272bps.
• Today on the data front we have industrial profits for June, which are not typically a market mover. There is no consensus for this print, but note the prior outcome was -12.6% y/y.
• In the equity space, the Golden Dragon index finished notably higher in Wednesday US trade, +2.82%. This came after modestly weaker closes for onshore equities yesterday (CSI 300 -0.21%), while Northbound stock connect flows were a modest 0.5bn yuan (down from Tuesday's bumper +19bn outcome).
• China Vice President Han Zheng told Visa Chair Alfred Kelly in Beijing that China welcomes US and other offshore investment and business. Han stated he hopes US companies play a more important role in economic and trade cooperation between the two countries (see this Bloomberg link).