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Free AccessUSD/CNH Rebounds With USD/JPY, Albeit With Lower Beta
USD/CNH sits just off session highs, last around 7.1430/40. We got to 7.1528 in earlier dealings, with the pair following USD/JPY higher in the first part of trade, albeit with a fairly low beta. CNH is off a little over 0.10% at this stage, while yen has fallen more than 1%. Intra-session lows from Monday were 7.0838. Note onshore spot finished up at 7.1396 yesterday.
- CNH is likely to broadly follow USD/JPY trends in the near term, as focus remains on broader risk trends and the extent of carry trade unwinds.
- The CNH v JPY correlation is still 67% for the past month, based off daily percentage changes.
- USD/CNH remains will below all key EMAs, while note yesterday's early highs were 7.1663.
- Locally, the data calendar is empty until tomorrow's July trade figures. Note on Friday we have July CPI data.
- Some focus will be on local bond yields, with state banks bond sellers yesterday (per BBG, see this link). This is likely part of the broader efforts to curb yield downside by the authorities.
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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.