USD/CNH advanced from the off,...........>

CHINA YUAN: USD/CNH advanced from the off, correcting yesterday's slump. The

upswing was interrupted by a stronger than exp. PBoC fix at CNY7.0312 vs. a RTRS

est. of CNY7.0502. The pair dropped off session high post-fix before bouncing &

extending gains. It last trades at CNH7.0359, ~230 pips higher on the day.

- Data-wise, focus falls on a slew of China's monthly activity indicators, incl.

industrial output, unemployment, and retail sales, due at the top of the hour.

- USD/CNH cratered yesterday as the U.S. decided to take some consumer goods off

the list of Chinese imports to be tariffed on Sep 1, to save domestic consumers

from being affected in the run-up to Christmas. The value of these goods is est.

to be ~$160bn, they'll be subject to tariffs on Dec 15. The impact of tariff

delay was magnified by both sides signalling being in touch re: trade matters.

USD/CNH shed ~900 pips as a result, briefly probing the water below CNH7.0000.

- Bears look for a dip below the psychological CNH7.0000 level, which would

clear the way to the 21-DMA at CNH6.9625. Meanwhile, bulls would be pleased by a

break above the 38.2% fibo retracement of the Aug rally at CNH7.0492, which

would draw their attention to the CNH7.1000 mark.