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25 Sep 2015
USD/CNY: China’s economy difficult to stabilize - MUFG
FXStreet (Delhi) – Research Team at MUFG, note that PMIs are suggesting that China's remains an economy difficult to stabilize but are expecting USD/RMB to trade with neural bias for the coming week within the range of 6.3450-6.4000.
Key Quotes
“Despite active Big Bank presence across the curve, USD/RMB ground higher (leaning in the direction of government preference proved not so wise in the past week). Both suggest continuing capital outflows.”
“China's interventions are occurring against the backdrop of still a strong USD/EM bid, most dramatically in BRL. But the conclusion of President Xi's US visit still requires more stage management. For China's firms and households the objectives of the new exchange rate management remain unclear, leaving uncertainty. While Golden Week and shut markets may provide officials some hoped-for respite, official China desperately needs better ideas.”
Key Quotes
“Despite active Big Bank presence across the curve, USD/RMB ground higher (leaning in the direction of government preference proved not so wise in the past week). Both suggest continuing capital outflows.”
“China's interventions are occurring against the backdrop of still a strong USD/EM bid, most dramatically in BRL. But the conclusion of President Xi's US visit still requires more stage management. For China's firms and households the objectives of the new exchange rate management remain unclear, leaving uncertainty. While Golden Week and shut markets may provide officials some hoped-for respite, official China desperately needs better ideas.”