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USD/CNH Holds Above 7.1900, 2024 Economic Focus On Industrial Policy

CNH

USD/CNH was supported on dips post the US CPI print. The pair getting to 7.1764 before pushing back towards 7.1970. We track near 7.1925 in early trade today, little changed for Tuesday's session. Note onshore spot finished at 7.1772 on Tuesday, while the CNY NEER (J.P. Morgan Index) fell 0.20% to 123.65.

  • For USD/CNH we haven't breached 7.2000 on this recent rebound, while the late Nov/early Dec dip sub the simple 200-day MA (near 7.1495), didn't prove sustainable.
  • Headlines crossed late yesterday from China's central economic work conference, which didn't deliver many fresh surprises.
  • The emphasis was on industrial policy, while several sell-side analysts noted there weren't any hints of a meaningful step up in economic stimulus, particularly in relation to the consumer (see this BBG link).
  • This may leave equity bulls disappointed. To recap, yesterday the CSI closed marginally higher, +0.21%. Headlines related to the economic work conference came out after yesterday's onshore close. Note though in Tuesday US trade, the Golden Dragon index still rose 0.44%.
  • The data calendar is empty today, although we still wait for Nov aggregate finance figures.

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