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Spot USD/CNH ticked higher as the acceleration in China's headline industrial profits growth proved elusive, with upstream industries benefitting at the cost of downstream ones amid higher input prices.

  • The rate last sits at CNH6.3817, 30 pips higher on the day. Bulls look to further gains past Oct 21 high of CNH6.4000. A break above that level would bring Oct 19 high of CNH6.4290 into view. Bears eye Oct 19 low/ascending trendline drawn off 2018 low at CNH6.3687/76 for initial support.
  • China's industrial profits growth accelerated to +16.3% Y/Y in September from +10.1% recorded in August. The NBS noted that high commodity prices and supply bottlenecks have supported corporate profitability. They added that "at the same time, the unevenness of profitability between upstream and downstream industries is more prominent, and the foundation for the recovery of industrial enterprises' profits still needs to be further consolidated."
  • China Securities Journal reported that the recent rally of the yuan is unlikely to change the two-way movement of its exchange rate, as further gains in the redback will be limited by upward momentum in the USD, downward economic growth pressure in China and the narrowing gap in expected growth rates of the U.S. & China in 2022.
  • The PBOC fix came in at CNY6.3856 and only marginally diverged from the sell-side estimate of CNY6.3853.
  • BBG sources said that Chinese authorities have asked billionaire Hui Ka Yan to help alleviate Evergrande's debt crisis with his personal wealth.