Stops Short Of 6.50

The strength in the greenback took USD/CNH all the way up to 6.4995, within touching distance of the psychological 6.50 handle, before running out of steam. The rate last on the screens at 6.4956..The weakness in the yuan puts a stop to an eight day rally as the yuan hit the highest levels in three weeks. After rising earlier this week following a fix below 6.50 from the PBOC, 1-month implied volatility slipped for a second day, dropping to around 4.15% and just above lows of 3.9375% hit last week.

• Seemingly positive rhetoric from the White House Climate Summit yesterday, NDRC officials said China would increase coal consumption until 2025, before decreasing usage from 2026 onwards. Climte enjoy Xie said China and the US discussed working together to reduce methane emissions while separately China said developed countries should increase climate change aid.
• Elsewhere, CNOOC, China's largest oil and gas producer reported earnings which saw a 21% increase in Q1 revenue, the firm cited a low base effect and increased oil prices. The company remains embroiled in a delisting spat between the US. and China, CNOOC has requested a review of the decision to remove the company's ADR's.
• No domestic data on the docket tonight