USD/CNH last seen at CNH6.9272. The......>

CHINA YUAN: USD/CNH last seen at CNH6.9272. The rate trades ~55 pips better off,

even as stronger than exp. yuan fix from the PBoC has capped gains. Worth

highlighting that the central bank has continued to fix its yuan mid-point vs.

USD sub-CNY6.9000 recently.

- The PBoC net injected CNY250bn via reverse repos today, which represented the

biggest daily injection since Jan 17. This occurs in the wake of a takeover of a

smaller lender at the end of last week.

- China's People's Daily wrote that "the U.S. shouldn't underestimate China's

ability to fight," amidst various signals suggesting that Beijing might

weaponize its dominant position as a rare earths supplier in the ongoing trade

war with Washington.

- Bulls look to recover yesterday's high of CNH6.9312 before attempting a move

at the May 20 YtD peak at CNH6.9514. Below CNH6.9194-76, which registered highs

on May 13-15, opens CNH6.8867, which represents the 23.6% fibo retracement of

the move from CNH6.6771 to CNH6.9514.

- China's official PMI readings will be released on Friday.