CNH: USD/CNH Maintains Recent Ranges, Golden Dragon Index Weaker In US Trade

USD/CNH maintained tight ranges post the Asia close on Thursday and tracks near 7.2060/65 in early Friday dealings. There was a slight downside bias, as US yields fell amid softer data outcomes, but CNH gained less than 0.10% for Thursday's session. The BBDXY index edged down 0.21%, although largely tracked sideways post the Asia close. Safe havens CHF and JPY outperformed in the G10 space. Spot USD/CNY finished up at 7.2074, while the CNY CFETS basket tracker lost a further 0.28% to 96.81 (per BBG). Recent lows for the index were sub 96.00.

• For USD/CNH technicals, not much has changed. Recent lows rest 7.1789, while on the topside the 200-day EMA, close to 7.2500, is likely to draw selling interest. This region marked highs back earlier in May.
• In US trade, the Golden Dragon equity index lost nearly 2.4%, with disappointment around Alibaba's revenue growth cited as a factor amid concerns around China consumer related demand. In contrast the SPX managed a modest rise, while the Nasdaq edged down. Greater Fed easing odds, post the data outcomes helped US equities.
• In any case, the China to world equity ratio has largely tracked sideways in recent weeks, not providing a strong signal for USD/CNH.
• The local data calendar may see Apr FDI print today, but greater focus will be on Apr activity figures, along with home prices, which print next Monday.