USD/CNY traders looking for true north – BTMU

By FXStreet FXStreet (Guatemala) – Lee Hardman, analyst at The Bank of Tokyo Mitsubishi UFJ explained that the victory parade is over and focus turns to whether various artificial supports (from safety to air pollution) return to the barracks.

Key quotes:

“While pre-parade dressing marched onshore down to the big 6.35 figure we had suggested two weeks ago, following the new RRR on forwards, swaps and options there were entire sections of the onshore market refusing to quote RHS on DF.”

“The near-1,000pip gap between USD/CNH and USD/CNY spot is an indication of where True North lies. Upcoming reports of foreign reserve losses (we are anticipating a larger-than-consensus decrement) and sluggish exports are going to continue the bids behind USD/CNY.”
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Source:: FX Street