USD/CNH Sees Fresh YtD High In Brief & Shallow Showing Above CNH7.0900

USD/CNH has touched another fresh YtD high. Bulls briefly forced a break of CNY7.0900 in the London morning (which topped out at CNH7.0907) as global equities softened and the USD firmed, although ticks away from extremes in those market moves leaves USD/CNH back around CNH7.0840.

• State-owned Chinese media outlets have once again pushed back on the idea of further sharp depreciation pressures for the yuan, with analysts cited in the report continuing to point to China’s positive economic fundamentals and expectations surrounding the end of the Fed’s easing cycle (even as geopolitical worry and the recent run of softer than expected data dominate current market sentiment, particularly vs. the USD).
• As noted elsewhere, offshore investors shed another CNY9.56bn of mainland equities on Thursday, with sales accelerating into the close, even as the benchmark CSI 300 recovered from worst levels. Today’s net sales represented a fresh multi-month extreme, while the 3-day rate of net sales recorded now sits at the most extreme level witnessed since October, which will be weighing on CNH.
• Technically, the top of the bull channel that is drawn from the Feb 2 low (CNH7.1435 today), presents the next level of meaningful resistance.