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USDCNH has broken back below the 6.97.........>

CHINA
CHINA: USDCNH has broken back below the 6.97 level, currently trading at 6.9694
after failing to hold above the 6.98 level earlier on. The uptrend remains
intact but bullish momentum is waning, thanks in part to the recovery in Chinese
stocks.
- The CSI300 remains clear of the 3200 level with the Oct 22 highs now in focus
just below 3300. For the HSI, a 1.8% rally has seen down trendline resistance
from the Sep 28 high give way, with the next level of resistance now coming in
at 26234.
- Rate markets are seeing some upside momentum feeding through from higher
stocks, with the 2-year swap up 1bp today 2.8350. However, with US yields on the
rise again the Us-China yield spread continues to rise, currently at 24.2bps.

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