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USD/CNH eased off in early Asia-Pac......>

CHINA YUAN
CHINA YUAN: USD/CNH eased off in early Asia-Pac trade today amid a continued
improvement in risk sentiment as worry re: U.S.-Iran tensions has dissipated. A
similar dynamic is evident across the Asian FX space. A slightly weaker than
expected PBoC fix pushed USD/CNH away from worst levels, but then the rate
turned tail again and printed a fresh multi-month low at CNH6.9224. The slide
occurred although China's inflation figures missed estimates as CPI rose +4.5%
Y/Y vs. exp. +4.7% & PPI fell -0.5% Y/Y vs. exp. -0.4%.
- At typing, the rate trades -104 pips at CNH6.9262. The low of Dec 12 at
CNH6.9229 provides the nearest technical floor, even as we saw a brief, marginal
look under that level. A convincing break here would shift bearish focus to the
CNH6.9000 mark. Conversely, bulls look for a clearance of the 200-DMA at
CNH6.9712. A move through the level would expose CNH6.9777, the Jan 6 high.
- RTRS sources said that Chinese FinMin will allow regional gov'ts to front-load
>CNY500bn in general purpose bond issuance to spur investment.

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