CNH: USD/CNH 50-day EMA Support Holds, China Equity Sentiment Stabilizes
USD/CNH is a little higher in the first part of Friday dealings, last near 7.2700. CNH gained 0.16% for Thursday's session, amid softer USD trends against the EU currencies. USD/CNY spot finished up at 7.2622. The CNY CFETS basket tracker edged a little higher to 99.04, up 0.11% (per BBG).
- Thursday lows in the pair were near 7.2650, leaving 50-day EMA support intact for now. Recent highs have been close to 7.2820, which will be in focus if we see a fresh move higher in the pair.
- Broader USD sentiment has ticked firmer today, but USD indices are little changed, with AUD and NZD weakness most evident so far.
- Helping the yuan yesterday was a better local equity backdrop. This continued into US trade, with the Golden Dragon index up 1.39%, recording back to back gains. The China to global equity ratio has stabilized, although is off recent highs.
- In terms of the local data calendar we have the final Q4 BOP read today. On Monday the March official PMIs are due. The market consensus is for a slight tick up in both manufacturing and non-manufacturing sentiment.
- Rtrs notes that China President Xi Jinping is expected to meet with key global business leaders on Friday.
- The other focus point will on any potential TikTok deal, which Trump said may carry some relief. We also have the reciprocal tariff announcement scheduled for April 2 next week as well.
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AUSTRALIA DATA: A$ Little Changed Post CPI Print
The January CPI print was mixed, with headline at 2.5% y/y, versus 2.6% forecast. The Dec outcome was 2.5%. The trimmed mean was 2.8%y/y, an uptick from the Dec outcome of 2.7%. More details to follow.
- AUD/USD is little changed post the print, holding in the 0.6345/50 region, so still slightly firmer for the session. Session highs rest at 0.6354.
AUSTRALIA DATA: Little Change To Inflation Rates In January
January headline CPI inflation printed lower than expected at 2.5% y/y, in line with December. However, the underlying trimmed mean rose 0.1pp to 2.8%, but still below the top of the RBA’s 2-3% band. The first month of the quarter has limited updates for services inflation. More details to follow but see ABS press release here.
MNI: AUSTRALIA MONTHLY JAN CPI 0.6% MM, 2.7% YY
- MNI: AUSTRALIA MONTHLY JAN CPI 0.6% MM, 2.7% YY
