USD/CNH Consolidates Above 7.1200, July Industrial Profits Out Today

USD/CNH spent most of the post Asia close on Monday consolidating above 7.1200, although the pair couldn't push meaningfully above 7.1250. CNH lost 0.09% for Monday's session, in line with a broader recovery in USD indices. USD/CNY spot edged higher slightly, finishing Monday's session at 7.1220.

• The CNY CFETS tracker fell 0.34%, offsetting gains from the end of last week. The index is now 97.56 back close to early Jan levels from this year.
• The fixing bias will be watched today, with yesterday's higher than expected outcome (in USD/CNY terms) helping provide somewhat of a floor for USD/CNH. For the pair, intra session lows from Monday came in at 7.1070. Recent highs have been marked close to 7.1500.
• Broader USD sentiment was aided on Monday by a modest uptick in Tsy yields, with the Fed's Daly giving some caution on the size/pace of rate cuts. US-CH yield differentials have stabilized somewhat in recent weeks with China onshore bond yields mostly showing a downside bias amid economic headwinds. The 10yr is sub 2.20% despite on-going scrutiny of bank bond positions by the PBoC.
• On the data front today we have July industrial profits. The June print saw a +3.6%y/y outcome (there is no consensus estimate).
• Property woes are weighing on land sales, which is curbing local government revenues and therefore their ability to provide meaningful stimulus/expenditure.