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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CNH
USD/CNH got to fresh record highs in overnight trading, close to 7.3750, before broader USD weakness took the pair lower. We are now back at 7.3135/40, little change from NY closing levels. If we see further downside 7.3000 could be a support zone, while highs from last week around the 7.2800/50 region could also be in focus.
- Through yesterday's session CNH gained just under 0.2% against the USD, lagging the 1.00% decline in the DXY index.
- This leaves the yuan weaker in NEER terms. The J.P. Morgan CNY NEER fell a further 0.59% yesterday, the 7th straight fall for the index. We are close to YTD lows for the metric, but remain well above 2020 lows, see the chart below.
- The China Golden Dragon index rebounded 4.55% overnight, recouping some of the 14.4% drop from Monday's session. Onshore and HK equities finished slightly lower yesterday in volatile trading conditions.
- Onshore spot ended yesterday 7.2687, the 4:30pm level was much higher though at 7.3085. Some offset should come from the weaker USD overnight in terms of today's fixing outcome.
- The authorities vowed to continue with foreign exchange reform and keep the currency stable at a reasonable level (see this link for more details).
Fig 1: J.P. Morgan CNY NEER
Source: J.P. Morgan/MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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