USD/CNH Back Close To Monday Highs Amid Firmer US Yields, Trade Data Out Today

USD/CNH broke above 7.1500 as Tuesday's US session unfolded. We got to highs around 7.1650, but sit slightly lower (last near 7.1585) in early Wednesday dealings. This was a CNH loss of 0.29% for Tuesday's session. Spot USD/CNY finished up at 7.1558.

• BBG noted that onshore USD selling pressure remained fairly firm through Tuesday onshore trade. This likely helped keep a cap on USD/CNH during Asia Pac hours around the 7.1500 level.
• As we progressed through US trade, such flows were likely less prevalent. Coupled with a firmer US yield backdrop, with the US Tsy curve bull steepening, weighed on CNH. US yields have unwound a good chunk of their post NFP losses, with some calmness returning to global equity markets helping the move.
• For USD/CNH we are close to Monday highs of 7.1663, beyond that there isn't much in the way of topside resistance until 7.2032, which was the July 25th low. Recent lows rest at 7.0838, the August 5th low.
• Today on the data front we have July trade figures. Exports are expected to remain healthy at 9.5%y/y, versus 8.6%y/y prior. Imports are projected at 3.2%y/y (prior -2.3%). This would leave the trade surplus just off June cycle highs ($98.35bn projected).