USDCNH is trading around 6.71 as bears...>

CHINA YUAN: USDCNH is trading around 6.71 as bears keep the pressure on the 6.70

level. Below here would open a run at the 6.60 level which marks the July 10

low. EURCNH recovered 7.70 on the back of the Fed decision, but the broader

downtrend remains intact, as does the rise in China's REER. 

- While the authorities will not welcome the ongoing yuan strength, there are

signs of stabilization in the economy with manufacturing and non manufacturing

PMIs both beating expectations today coming in at 49.5 and 54.7 respectively.  

- The more dovish Fed outlook has provided more room for the PBOC to ease which

has seen swap rates edge lower this morning, but US-China swap spreads remain

lower following the sharp move lower in the US. 

- Trade talk headlines look set to dominate over the coming days while the

Caixin PMI is also due out this time tomorrow.