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USD/CNH has a look above Friday's........>

CHINA YUAN
CHINA YUAN: USD/CNH has a look above Friday's peak, printing at CNH6.9877, the
highest level seen since Jan '17, before moving to CNH6.9850.
- The trade war dynamic remains front & centre, with the combative tone of U.S.
Pres. Trump & Chinese off'ls noted at the end of last week. Trump suggested that
the Chinese currency is "going to hell." The majority of the Chinese state media
outlets have struck a cautious tone re: further progress in trade matters, while
the Global Times maintained its usual, aggressive stance.
- It is worth recapping our latest insight piece, which saw Zhou Xiaoming, a
former MOFCOM off'l, suggest that the planned September trade talks may not now
take place. Zhou noted "China would like to reach a solution, but the U.S. is
asking too much." But Wang Haifeng, director of International Trade and
Investment at the Chinese Academy of Macroeconomic Research run by the NDRC,
thinks Trump's latest threat is an attempt to pressure to China move more
quickly when staff level off'ls talk in August & is unlikely to be implemented.
- CNH7.00 remains the key area of interest on the upside.
- Will the PBoC finally fix > CNY6.90 at today's USD/CNY fix?
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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