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Policymaker Concern Remains Evident

CNH

MNI (London) - USD/CNH has been protected by the USD/CNY fixing’s most notable YtD lean against CNY weakness (360 pips), while yesterday’s Financial News article pointing to the potential for CNY stability, at a minimum, also reverberates as policymaker angst re: the yuan remains evident.

  • Yuan stability (on the day) comes even as mainland equities are subjected to light net outflows via the Hong Kong Stock Connect links, along with pressure for both the CSI 300 & Hang Seng.
  • A lack of immediate, meaningful stimulus continues to underpin USD/yuan, with many questioning if policymakers will deliver more forceful support for the economy.
  • USD/CNH threatened to test CNH7.2700 on a couple of occasions, but last sits around CNH7.2585, 35 or so pips softer on the day, with the well-defined technical parameters that we have flagged recently in play.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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