USD/CNH Near 7.3100, As China Markets Re-Open Today

China markets return today, after being out all of last week for the Golden Week holiday. USD/CNH currently tracks near 7.3100, slightly up levels from this time last week (closer to 7.3000). Moves above 7.3300 were faded last week though. Note USD/CNY spot closed before the Golden Week holiday period at 7.2980.

• Early sentiment may be dominated by broader risk flows, as markets trade with a risk-off tone in early Monday trade, which follows the surprise Hamas attack on Israel over the weekend. The USD is bid against higher beta FX (safe havens JPY and CHF are slightly firmer), while oil futures have spiked, as have US Treasury futures. US equity futures are weaker.
• More broadly China sentiment has improved over the past week, with sell-side analysts nudging higher growth projections modestly for 2023.
• The China Government noted trips and spending surged in Golden week relative to 2022 levels, but were only slightly up on 2019 (pre Covid levels), see this BBG link for more details.
• In the equity space, in Friday US trade, the Golden Dragon index ended with a +2.60% gain to finish close to unchanged versus pre Golden Week holiday period levels.
• This week on the data front, September aggregate credit figures/new loans are due (release window is 9 Oct to the 15th). Also, on Friday we September CPI figures.