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USDCNH is back below the 6.90 level,.....>

CHINA YUAN
CHINA YUAN: USDCNH is back below the 6.90 level, last at 6.8944, amid broad
based dollar weakness, with the pair looking to establish another lower high
from the Nov 1 peak. The 50-dma continues to act as key resistance, below which
a topping process looks likely. 
- The yuan strength has come despite the recovery in US yields which has seen
US-China 2-year swap spreads edge back up to 13bps. The ongoing fall in oil
prices is providing some support to the yuan.
- Despite gaining vs the dollar the yuan is losing ground vs the euro, with
EURCNH hitting a higher high yesterday, breaking above the 7.90 level to confirm
the break above down trendline resistance. 

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