USD/CNH Steady, USD/CNY Spot Consolidates Above 7.2400, Remains Close To Daily Trading Limit

USD/CNH maintained a sideways trend post the Asia close on Monday. The pair sits near 7.2500 in early Tuesday dealings, with dips sub this level supported on Monday. USD/CNH was basically unchanged for Monday's session. For spot USD/CNY, we finished up at 7.2436, just shy of Monday highs near 7.2440. This was the highest close going back to mid-November last year.

• This leaves onshore spot very close to the upper end of the daily trading band. Since the USD/CNY fixing pushed above 7.1000 last week we have stayed above this level, but haven't pushed above 7.1050.
• March FX settlement data, released late last week, continued to show capital outflow pressures. The authorities will look to manage depreciation pressures and the PBoC Governor reiterated late last week the yuan will be kept basically stable (per BBG). He also highlighted Q1 growth is a good start to achieving the 5% growth target this year.
• The consensus sell side estimate for China growth has risen in recent weeks for 2024, but remains sub 5% (last at 4.7%). The Citi China surprise index has largely tracked sideways in recent months. We may need to see fresh upside momentum in this index before we see further growth upgrades.
• On the data front, we have March industrial profits out on Saturday, while the April PMIs print next Tuesday.