CNH: USD/CNY Fixing Lower, Error Term Slightly Tighter

The USD/CNH fix printed at 7.1366, versus a Bloomberg market consensus of 7.1683

• The fix dropped sharply, given softer USD, while the fixing error also narrowed to - 317pips, from -351pips yesterday.  
• USD/CNH is through 7.1795 in morning trading after opening at 7.1842

The AOFM sells A$300mn of the 4.25% 21 June 2034 Green Bond:

• Average Yield (%): 4.0889 (prev. 4.2162)
• High Yield (%): 4.0900 (prev. 4.2175)
• Bid/Cover: 4.9267x (prev. 5.1625x)
• Allotted at Highest Accepted Yld as % of Bid at that Yld (%): 62.3 (prev. 66.7)
• Bidders: 37 (prev. 31), 12 (prev. 8) successful, 5 (prev. 2) allocated in full

In Tokyo morning trade, JGB futures are stronger and at session highs, +27 compared to settlement levels.

• (Bloomberg) -- Many Bank of Japan board members held the view that if the central bank cuts its buying of Japanese government bonds too quickly, it might have an unforeseen impact on market stability, according to the minutes from the central bank’s June meeting.
• S&P Global PMIs for July have printed: Services Index rises to 53.6 from 51.7 in June; Composite Index rises to 51.6 from 51.5 in June.
• Cash US tsys are slightly mixed, with a steepening bias, in today’s Asia-Pac session after yesterday’s modest extension of Friday’s rally.
• Cash JGBs are flat to 3bps richer across benchmarks, led by the 10-year. The benchmark 10-year yield is 3.2bps lower at 1.485% ahead of today’s supply.
• Tuesday’s sale of 10-year JGBs may help the nation’s debt recover further from its recent struggles should it go off at similarly strong metrics to the last two sales. Yields are high enough to potentially entice buy-and-hold investors, while the international backdrop turned positive with     Friday’s weak US payrolls data. (BBG)
• Swap rates are slightly lower. Swap spreads are mostly wider.