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USD/CNH On Course For Weekly Gain


USD/CNH has bounced into positive territory and last trades +48 pips at CNH6.6222. The PBoC fix fell in line with expectations, as it came at CNY6.6285.

  • On Thursday, U.S. Pres Trump signed off on an executive order banning U.S. investments in Chinese companies with links to the People's Liberation Army. The White House argued that the order, due to take effect on Jan 11, will prevent U.S. capital supporting firms posing a threat to U.S. national security.
  • The rate is poised to register gains this week and bulls look for a break above Nov 9 high of CNH6.6495 to open up potential for further gains. Above there would bring the 50-DMA/Nov 4 high at CNH6.7282/6.7745 into view. Bears need a fall through Nov 9 low of CNH6.5475 before targeting the CNH6.5000 a
  • Looking into next week's docket, we see a busy Monday ahead. A slew of Chinese monthly economic activity indicators is due, while the PBoC will conduct Medium-Term Lending Facility operations. The operations will provide some interest, as participants are on the lookout for any signs on China's monetary policy, after Dep Gov Liu said that withdrawal from easing measures was "a matter of time".
  • Next Friday, the PBoC will announce its latest LPR fixing.

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