10 Mar 2016
CNY: expect wide fixings - BTMU
In respect of the CNY, analysts at Bank of Tokyo Mitsubishi explained that they still expect wider (larger day-to-day variations in) fixings to keep the basket stable.
Key Quotes:
"But authorities also continue to guide spot > its YE2015 close, which implies that all the weakening vs. USD we saw in 2015 they wanted. This is still the case should the dollar weaken more broadly, regardless of the basket.
February's reserve change was -ve implying continuation of capital outflows; the bid behind DF points says the same. PPI metals prices recovered but deeply -ve export growth say to us current stimulus is a lot more Old Economy than New. Property prices are also frothing up. These might be the biggest message out of this NPC."
Key Quotes:
"But authorities also continue to guide spot > its YE2015 close, which implies that all the weakening vs. USD we saw in 2015 they wanted. This is still the case should the dollar weaken more broadly, regardless of the basket.
February's reserve change was -ve implying continuation of capital outflows; the bid behind DF points says the same. PPI metals prices recovered but deeply -ve export growth say to us current stimulus is a lot more Old Economy than New. Property prices are also frothing up. These might be the biggest message out of this NPC."