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USD/CNH Steady, Hovers Above Cycle Lows

CNH

USD/CNH has faded its initial upswing and last trades at CNH6.56222, little changed on the day. The move off highs has been aided by a moderation in the greenback's strength. The PBoC fix fell in line with expectations, providing no new impetus.

  • In a video address to APEC leaders attending a summit in Kuala Lumpur, Chinese Pres Xi pledged support for multilateralism and said that China will not seek de-coupling and exclusive policy. Xi gestured towards the well-documented dual circulation strategy as Beijing's policy priority.
  • Earlier in the day, the Five Eyes Alliance (U.S., UK, Canada, Australia, New Zealand) criticised mainland China for removing Hong Kong lawmakers deemed disloyal to Beijing.
  • Bears would be pleased by a dip through yesterday's trough located at CNH6.5321. This would expose the CNH6.5000 mark, which has been intact since mid-2018. Bulls look for a break above Nov 12 high of CNH6.6349, before taking aim at Nov 9 high of CNH6.6495.
  • Looking ahead, China's LPR fixings are due Friday.

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