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USD/CNH Probing Thursday Lows Near 7.2600

CNH

USD/CNH is tracking back towards early Thursday lows, last near 7.2620 (Thursday lows printed near 7.2600). CNH is +0.40% firmer for the session so far, comfortably the best performer in EM Asia FX so far today. Early September lows in the pair sit at 7.2392. USD/CNY is already sub 7.2600.

  • The combination of better IP, retail sales data (although property data still indicated headwinds) has aided sentiment, as has the cash injection via the 1yr MLF (the rate was held steady at 2.50%). Positive data surprises may at the very least halt further growth forecast downgrades.
  • Hoing Kong equities are doing better, +1.7%, while onshore equities are only marginally higher. Northbound stock connect flows are close to flat.
  • Onshore bond yields are 2-4bps firmer across the curve. Yield differentials are still relatively steady with the USD though.

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