USD/CNH Stops Short Of Fresh Test Above 7.1900, CNY NEER To Fresh Lows

USD/CNH spent most of the post Asia close drifting higher, although the pair didn't breach the 7.1900 handle in NY trade. We pulled back to 7.1820/30 by the close, as USD indices moved off session highs. CNH lost 0.26% for Tuesday's session.

• USD/CNY closed above 7.1800, while the 4:30pm level (the input into the CNY fix for today) was 7.1744, a fresh high back to Nov 2022. The CNY NEER (J.P. Morgan index) is now back to 121.00, fresh lows back to May 2022.
• In US trade on Tuesday, the Golden Dragon index lost 4.90%, the sharpest single day drop since March 9 of this year. US markets were closed on Monday, so part of this move likely reflects some catch up.
• Still, broader China related asset sentiment has been left disappointed around stimulus plans. The 5yr LPR was cut by 10bps yesterday, but some had been looking for a 15bps cut. We also continue to see sell-side names curbing 2023 growth expectations as well.
• The local data calendar is quiet until industrial profits print on the 28th of June (next Wed), but most focus will rest on the official PMIs for June out on the 30th (next Friday).