CNH: USD/CNH Near 7.2900, China Pushes Back On Talk Of Trade Progress

• RES 3: 96.501 - 76.4% of the Mar 14 - Nov 1 ‘23 bear leg
• RES 2: 96.207 - 61.8% of the Mar 14 - Nov 1 ‘23 bear leg
• RES 1: 95.740/851 - High Mar 4 / High Dec 11 
• PRICE: 95.520 @ 16:00 GMT Mar 25
• SUP 1: 95.420/95.300 - Low Feb 13 / Low Jan 14  
• SUP 2: 95.275 - Low Nov 14  (cont) and a key support
• SUP 3: 94.640 - 1.0% 10-dma envelope

Aussie 10-yr futures have faded sharply off last week’s mid-week high, opening a small gap with first resistance. For bulls, a confirmed reversal and a breach of 95.851, the Dec 11 high, would instead reinstate a bull cycle and refocus attention on resistance at 96.207, a Fibonacci retracement point. A stronger bearish theme would expose 95.275, the Nov 14 low and a key support. Clearance of this level would strengthen a bearish condition.

ACGBs (YM -4.0 & XM -3.0) are weaker.

• Overnight, the 2025-26 federal budget promised relief for taxpayers, including a surprise extension to tax cuts that started last year, and incentives for families with kids in early childhood education, student debt holders, and beer drinkers.
• US tsys finished Tuesday with modest gains, with US 2-year and 10-year yields 2bps lower. US tsys pared losses after Philly Fed non-mfg and Conf. Board Consumer Confidence came in lower than expected.
• Cash ACGBs are 3-4bps with the AU-US 10-year yield differential at +14bps.
• Swap rates are 3-4bps higher.
• The bills strip contracts are -3 to -5.
• RBA-dated OIS pricing is flat to 4bps firmer across meetings today. A 25bp rate cut in April is given a 3% probability, with a cumulative 62bps of easing priced by year-end (based on an effective cash rate of 4.09%).
• Today, the local calendar will see February CPI data. It is the middle month of the quarter and so will include updates to services components. Headline is forecast to be steady at around 2.5%. The trimmed mean printed at 2.8% in January.
• The AOFM plans to sell A$800mn of the 3.50% 21 December 2034 bond tomorrow and A$700mn of the 1.25% 21 May 2032 bond on Friday.

• RES 3: 97.190 - High May 5 2023
• RES 2: 96.730/932 - High Sep 17 / 76.4% of Mar-Nov ‘23 bear leg 
• RES 1: 96.360 - High Dec 11  
• PRICE: 96.230 @ 15:59 GMT Mar 25
• SUP 1: 95.900 - Low Jan 14  
• SUP 2: 95.760 - Low 14 Nov ‘24
• SUP 3: 95.480 - Low Jan 11 2023 and a major support 

Aussie 3-yr futures have pulled back from their most recent highs - a correction. A resumption of gains would signal scope for 96.360, the Dec 11 high. Clearance of this level would open 96.730, the Sep 17 ‘24 high. On the downside, a stronger reversal lower from current levels would signal a resumption of the downtrend. A deeper sell-off would refocus attention on 95.760, the 14 Nov ‘24 low.