Offshore Yuan Inches Higher Despite Targeted Lockdowns In Chinese Cities

Spot USD/CNH has edged lower, with the move aided by a downtick in the DXY. The rate trades -23 pips at CNH6.3783 at typing, with bears looking for a fall through Jan 5 low of CNH6.3660, followed by Dec 31 low of CNH6.3379. Conversely, bulls look for a clearance of Jan 6/Nov 26 highs of CNH6.3976/99 before setting their sights on Oct 29 high of CNH6.4104.

• Xinhua reported that Anyang city in the central province of Henan has imposed a lockdown after detecting a case of the Omicron variant. Separately, Tianjin city imposed lockdown in two towns in Xiquing district to contain the spread of the variant.
• China's Cabinet vowed to boost investment in more than 100 key projects and stimulate consumption to stabilise economic growth. They said in a statement that "the economy is at a crucial juncture of overcoming difficulties."
• China's inflation data will draw attention tomorrow, with Bloomberg consensus forecasts pointing to slight moderations in both CPI and PPI growth. Later this week, monthly trade data will hit the wires on Friday.