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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 rose 0.34% for Thursday's session. The pair tracks near 7.2500 in early Friday dealings. We mostly tracked higher post the Asia close on Thursday, with highs at 7.2583, which is around the 100-day MA. USD/CNY finished up at 7.2450, a yuan loss of 0.25%.
- USD/CNH's rebound (earlier Thursday lows were close to 7.2100) is at odds with lower USD/JPY levels, see the chart below. This suggests we may be seeing some waning in the correlations between the two currency pairs.
- Yesterday's much weaker Caixin PMI print reinforced weaker growth prospects for the economy. Little signs of a material pick up in house sales for July (-20%y/y, versus June's -17%y/y outcome) is another concern.
- This will be seeing easing expectations continue from the China authorities, while BoJ's hawkish hike this week as aided yen outperformance.
- The local data calendar is empty until Monday's Caixin services and composite PMI prints.
- In the cross asset space, the CSI 300 fell 0.66% yesterday. The Golden Dragon index fell 3.35% in Thursday US trade (with broader tech headwinds in play). For local CGB yields we remain biased lower, the 10yr closing under 2.12% yesterday.
Fig 1: USD/CNH & USD/JPY Diverging Somewhat
Source: 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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