Yuan Strengthens As Xi Speaks, LPR Rates On Hold

The yuan is stronger, USD/CNH down 93 pips at 6.4996, the decline accelerating after dropping through 60.5050. The PBOC kept LPR rates unchanged for the twelfth month, this was widely expected and received to little fanfare. As a note, The PBOC conducted MLF operations last week, and kept the rate unchanged; the previous the occasions that the LPR was changed was preceded by a change in the MLF rate.

• Chinese President Xi is speaking at the annual Boao Forum, comments from Xi are broadly in line with his previous. He said China must uphold multilateral trading with the WTO at its core, he also noted that China continues to cut the negative list for inbound FDI. He also called for global vaccine coordination, adding must vaccines cheap and available to all. He played down China's role on the international stage, saying China would never seek expansion or hegemony, and would never engage in an arms race.