USD/CNH Sitting Close To 6.9600, April Activity Figures On Tap Today

USD/CNH downside couldn't extend beyond the 6.9550 level on Monday. We spent most of the post Asia close not too far away from 6.9600, which is where we currently track. This left CNH 0.18% firmer for Monday's session against the USD, while the NEER nudged a little higher to 124.52.

• Late yesterday the PBoC noted that it will keep monetary policy appropriate in its Q1 monetary policy report. The central bank stated that while inflation is mild it will gradually pick up in the second half. This comes after yesterday's steady MLF outcome, albeit with slightly larger rollover volumes (125bn yuan versus 100bn expected).
• Today we have the April activity data dump. Favorable base effects from 2022 should ensure an improvement in y/y momentum, although last week's credit/inflation and import outcomes suggested the recovery has lost some traction (see this link here for more details).
• In the equity space, the China Dragon index rallied just over 4% in US trade on Monday. This followed a strong rebound for onshore equities yesterday, with the CSI 300 rallying 1.55%, with most gains post the lunch break. Financials were the main driver of the move (see this link).
• The new swap connect program saw 162 transactions (totaling 8.26bn yuan) on its first day in action.