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The latest leg lower in USDCNH has come in....>

CHINA
CHINA: The latest leg lower in USDCNH has come in spite of rate markets giving
back their early gains. The 2-year faced stiff resistance at the 2.6% level,
which has seen it drop back down to 2.5625%, marginally down on the day. 
- The rate decline comes even as equities are resuming their gains, with the
CSI300 up 0.8% and the HSI up 0.7% on the day. 
- Rate markets seem to be the odd one out by not rallying alongside stocks and
the yuan suggesting that traders expect a stronger yuan to allow further PBOC
easing. However, with risk assets rallying and inflation expectations likely
rising in line with global trends, the PBOC may not need to cut as much as
expected.    

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