USD/CNH: A sudden weakness amid USD strength – DBS
|China cut the 1Y and 5Y LPR by 25bps on Monday to 3.10% and 3.60% respectively. USD/CNH had surged to mid-7.13 levels amid broad USD strength, DBS’ FX analyst Philip Wee notes.
RMB market mood shifts amid a resurgent Trump
“China cut the 1Y and 5Y LPR by 25bps on Monday to 3.10% and 3.60% respectively. These cuts to benchmark lending rates were expected given a 20bps cut to the 7D reverse repo rate in late September, and are part of a broader policy push to stimulate growth in China.”
“USD/CNH had surged to mid-7.13 levels amid broad USD strength, opening a gap with the onshore CNY fixing. RMB flows have become more two-way, after an earlier bout of equity inflows into China briefly led to a dip in USD/CNH below 7.”
“We had flagged US election and trade risks as reasons to be restrained on RMB optimism earlier, and it seems the RMB market mood has indeed shifted amid a resurgent Trump.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.