USD/CNH last deals at CNH6.7851, 120.....>

CHINA YUAN: USD/CNH last deals at CNH6.7851, 120 pips better off. The PBOC

central fixing is exp. to come in at CNH6.7517 per dollar, according to RTRS.

- Monday saw USD/CNH show above CNH6.8000 for the first time since mid-February,

as Sino-U.S. trade war escalated. The weekend saw U.S. Pres Trump threaten with

fresh tariffs on Chinese goods, before a WSJ piece suggested that Chinese

delegation might cancel this week's trip to the U.S. USD/CNH then faded through

the day, amidst reports that Chinese envoys will visit Washington after all.

- USD/CNH jumped around today's Asia open, as U.S. TR Lighthizer & U.S. Tsy Sec

Mnuchin criticised Beijing for "erosion of [earlier] commitments" and confirmed

fresh tariffs on China, which will take effect on Friday.

- Monday saw a topside breach of the neckline resistance at CNH6.7500 after the

pair formed a triple bottom pattern. A break above yesterday's peak at CNH6.8218

would bring the measured target at CNH6.8296 into play. Meanwhile, bears look

for a pullback through the 100-DMA at CNH6.7604.

- The escalation in U.S.-China trade war turns focus to Chinese trade data, due

Wednesday, with inflation data coming out on Thursday.