VAST MAJORITY OF FOMC SAY PRUDENT TO SLOW QT FAIRLY SOON

BOC: IF THINGS EVOLVE AS EXPECTED, WILL BE APPROPRIATE TO CUT

BOC SAYS JUNE RATE CUT IS WITHIN REALM OF POSSIBILITIES

MNI BRIEF: Brazil Inflation 3.93% In March, Lowest In 9 Months

MNI Brief: China Targets Standards Update To Support Trade-ins

MNI BRIEF: Fitch China Outlook Downgrade Regrettable - MoF

MNI: US MAR TREASURY BUDGET -236.5B

US Treasury Auction Calendar

EZ/UK Bond Supply Calendar: 3/7/15+ Year BTP Auction Thursday

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

MNI BRIEF: Lawmakers Signal Tough Hearing For BOC's Macklem

© 1982-2023 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

Resurfacing COVID Troubles Exacerbate Yuan Woes

CNH

Worrying COVID-19 news have sapped strength from offshore yuan, sending spot USD/CNH to its strongest levels since May 27, despite a firmer than expected PBOC fixing.

  • Shanghai and Beijing reimposed some restrictions as COVID-19 numbers in both cities climbed, providing evidence of continued struggle to stamp out the virus. Beijing delayed the re-opening of most schools and admitted that an outbreak linked to a popular bar proves more difficult to control than previous clusters. Shanghai suspended dine-in services in most districts and punished several officials for missteps in the implementation of quarantine policies.
  • The PBOC set the yuan reference rate at a stronger than expected level for the third consecutive day. The mid-point of permitted USD/CNY trading band was set at CNY6.7182, 25 pips shy of the sell-side estimate. This comes on the heels of a 23-pip miss last Friday and a 21-pip miss on Thursday.
  • The move higher in spot USD/CNH has been facilitated by regional reaction to firmer than forecast CPI data released out of the U.S. after Asia hours Friday, which inspired some hawkish Fed repricing.
  • Spot USD/CNH trades at CNH6.7620, up ~320 pips on the day, with bulls looking to challenge May 27 high of CNH6.7856. A breach of that key resistance level would bode well for the bullish case, clearing the way to May 13 cycle high of CNH6.8380. Bears look for a pullback towards Jun 3/May 4 lows of CNH6.6170/6.6118.
  • Looking ahead, China's monthly economic activity indicators will hit the wires on Wednesday.
EM BulletHomepageBulletMarketsEmerging Market NewsForeign Exchange Bullets
EM BulletHomepageBulletMarketsEmerging Market NewsForeign Exchange Bullets

To read the full story

Close

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.