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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CNH
CNH outperformed the late USD rebound in NY trading, see the chart below. Support was evident for the pair in the low 6.7500 region though. We currently track slightly higher at 6.7570/80, as broader USD sentiment has started the session on the front foot. As we noted earlier, the domestic focus today will be with CPI and PPI inflation prints for July (see here for more details).
- The China currency has generally outperformed the move up in short term US yields in recent sessions. This is most evident in CNH/JPY, where the pair is back above 20.00. Note the 50-day MA comes in at 20.11.
- Relative equity trends have stabilized somewhat with the rest of the world as well, although this is as much to do with global equities faltering along with China equity sentiment stabilizing (the Shanghai composite is +2.65% above recent lows).
- Note the China Dragon index has dropped for the past 3 sessions, although this is likely to be reflective of broader tech wobbles.
- Domestic covid trends persist, although the major cities are avoiding a rebound in case numbers for now.
- CNH implied vol trends remain fairly benign, the 1 month not too far away from 5%, which is very much in line with the bounded spot range.
Fig 1: Short Term USD/CNH & DXY Trends
Source: MNI/Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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