USD/CNY on the front foot in early.......>

CHINA YUAN: USD/CNY on the front foot in early trade, last dealing at CNY6.9420,

~430 pips higher on the day in the wake of U.S. President Trump outlining the

latest round of tariffs to be slapped on Chinese goods as of September 1. Trump

later noted that this could be scaled up in steps, but did also point to the

possibility of doing less re: tariffs, contingent on trade talk developments.

The Editor of China's Global Times suggested that "the Chinese will no longer

give priority to controlling trade war scale, they will focus on the national

strategy under a prolonged trade war."

- Rate had a brief look above CNY6.9500, printing at CNY6.9502.

- Bulls look to the 2018 high of CNY6.9771 as their initial target.

- CNY7.00 remains the key psychological threshold on the upside, with many

officials and market participants believing that Chinese policymakers will do

everything that they can to protect the level, as a break above risks deep

capital outflows.

- Participants are on the lookout for any official Chinese response to Trump's

planned tariffs.