The CNY continues the sharp decline with USD/CNY now trading above 6.70, the highest level since August 2017, points out the research team at Danske Bank.
Key Quotes
“There is no sign of China intervening to halt the CNY decline as CNH offshore money market rates have dropped. Normally, China uses higher CNH money market rates to stem depreciation pressure. The lack of intervention suggests the Chinese government is allowing the CNY to slide possibly as part of the trade war with the US. We continue to see risk of further CNY weakness in the short term.”
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