MNI China Daily Summary: Friday, April 26

MNI BRIEF: China, US Should Strengthen Dialogue, Cooperation

MNI BRIEF: SNB Framework Reform 'Playing With Fire' - Steiner

MNI: PBOC Conducts CNY2 Bln Via OMO Fri; Liquidity Unchanged

CHINA PBOC INJECTS CNY2 BILLION VIA 7-DAY REVERSE REPOS FRI

MNI: PBOC Sets Yuan Parity Lower At 7.1056 Fri; -4.56% Y/Y

MNI: BAKER HUGHES US RIG COUNT 613; OIL RIGS 506; GAS RIGS 105

MNI: UNIV OF MICHIGAN CONSUMER SENTIMENT FINAL APR INDEX 77.2

EZ/UK T-Bill Calendar: Germany, France Auction on Monday

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

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Yen Outperforms On US Yield Pullback, Q1 Capital Spending & Profits On Tap Today

JPY

Yen was the second best performer for Wednesday's session, rising 0.32% against the USD. Volatility was high post the Asia close though, the pair spiked to 140.35/40, largely following the gyrations of US yields. US data was mixed, surveys missing but JOLTS better than expected. USD/JPY got back to the low 139.00 region towards the close, as dovish Fed rhetoric weighed. The pair last tracked at 139.30/35.

  • In terms of technicals, USDJPY bullish conditions remain intact and a pullback is considered corrective - for now. The pair has this week tested resistance at the top of the bull channel, drawn from the Jan 16 low which intersects at 140.86. This is a key resistance and a clear break of it would reinforce bullish conditions and open 141.61, the Nov 23 2022 high.
  • For bears, a stronger reversal would highlight a potential top. Key support to watch is 137.79, the 20-day EMA.
  • We have moved away from the 140.00 level for now, which appears to be a threshold that invites greater scrutiny from Japan's FX authorities.
  • The local data calendar has Q1 capital spending and company profits data on tap. Capex is expected to moderate, likewise for profits in y/y terms. Also out is weekly investment flow data (to May 26), then the final manufacturing PMI for May.
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