USD/CNH Tracks Near 7.2300, Despite Broad USD Pullback

CNH underperformed the USD sell-off overnight by a decent margin. USD/CNH last sits close to 7.2300. Moves towards 7.2500 late in NY trade were faded by the market, but the pair is still around 0.650% since the start of the week, compared with the ~0.60% dip in the DXY. The CNY NEER lost ~1% for the session per the J.P. Morgan index.

• There was some focus on a WSJ article overnight, which stated China is considering exiting Covid-zero, although it's likely to be done in a cautious manner, and no time-line was given. Since the weekend press conference from the health authorities, hopes for a quick shift away from covid-zero have arguably diminished.
• The China Golden Dragon index lost some positive impetus overnight, dipping almost 2.2%, despite broadly positive equity trends elsewhere.
• The domestic data calendar is quiet today, with focus resting on tomorrow's inflation prints. This comes after yesterday's weaker than expected trade figures, particularly on the export front.
• Yesterday's CNY fixing also printed slight weaker than market expectations, for the first time since late August. For today's fix, the 4:30pm level yesterday onshore was 7.2405, but weaker USD levels overnight should provide some offset.