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USD/CNH Back To 7.1600 Handle, But NEER Falls, June Trade Data Out Today

CNH

USD/CNH got close to 7.1600 post the US CPI print, but sits slightly higher in early dealings in Asia Pac trade, last near 7.1660. CNH rose 0.64% for Wednesday's session, while USD/CNY finished the session close to 7.1650. The CNY NEER (J.P. Morgan Index) fell to 120.41, -0.26%, as the yuan underperformed the broader USD sell-off modestly (BBDXY -0.94%). The NEER is now at fresh cyclical lows.

  • Today we have June trade data on tap. The market looks for weaker export growth in y/y terms (-10% forecast, prior -7.5%), while imports are forecast at -4.1% (prior -4.5%). The trade surplus is expected to rise a touch, consensus at $74.9bn, prior $65.79bn.
  • In US trade, the Golden Dragon index surged 3.37%, the fourth straight run of gains. It was reported yesterday that Premier Li Qianq met with senior executives from tech companies, aiding hopes the regulatory crack down on the sector is coming to an end (see this link).
  • To recap, the CSI 300 fell 0.67% yesterday, but the HSI rose 1.08%.
  • Elsewhere, China's state pension fund asked its asset managers to sell some bonds linked to riskier local government financing vehicles (LGFVs) and private developers (see this link for more details).

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