Stronger After PMI

Offshore yuan is stronger, moving out of negative territory following strong PMI data, USD/CNH last trades at 6.5723, still within yesterday's range. The pair challenged 6.5860 twice yesterday but failed both times, contacts note CNH dip buying near the level. 1-month implied volatility has risen for a second day to 4.8325%

• Official manufacturing PMI rose to 51.9 in March, above estimates for 51.2 and up from 50.6 previously; non-manufacturing PMI demonstrated some real pick up, March printed 56.3, well above 52.0 expected and up from 51.4 in February. Composite PMI rose to 56.3 from 51.6, denoting the highest reading since November 2020. The non-manufacturing sector likely benefitted from the relaxation of some of virus-containment measures, including travel curbs, virus testing requirements and capacity limits for entertainment venues.
• Elsewhere, in a sign geopolitical tensions will continues to simmer the US State Department accused China of crimes against humanity and reaffirmed a decision to label China's treatment of minority Uyghurs in Xinjiang genocide. US Secretary of State Blinken the US was considering what the consequences for violators of human rights would be, citing economic sanctions and visa restrictions against Chinese officials as an example and encouraging allies to do the same.