News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 87.94%, while traders in EUR/USD are at opposite extremes with 71.17%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/wSWdSw9NMi
  • WTI crude oil price action has been quite volatile today around Iran nuclear deal talks. The commodity is currently down -1.2% on the session after falling as much as -4.3% from intraday highs. #OOTT $CL_F $USO https://t.co/IPeHsxVYO8
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: US 500: -0.14% FTSE 100: -0.17% Wall Street: -0.21% Germany 30: -0.22% France 40: -0.30% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/7ak6BIkvMw
  • Biden administration delays revamp of Trump's blacklist for China investments -BBG $USDCNH $SHCOMP
  • $EURUSD breakout stalled (so far) around the same spot that caught the feb top fib from the same study that caught the low in march (at the 38.2) https://t.co/ikWed0YfwE https://t.co/OfvmSW2V4S
  • The USD/CAD breakdown has stalled into lateral technical support at 1.2048/61 and the focus is on a reaction off this mark. Get your $USDCAD @MBForex here:https://t.co/LMTzDyI1df https://t.co/hD74PjjJHk
  • US Dollar Outlook: DXY Index Hammered as Treasury Yields Ebb -via @DailyFX Link to Full Analysis: https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2021/05/18/us-dollar-outlook-dxy-index-hammered-as-treasury-yields-ebb.html $USD $DXY #Trading https://t.co/2zVfDWI5Y7
  • AUD/USD attempts to retrace the decline following the update to the US Consumer Price Index (CPI) as it bounces back from the 50-Day SMA (0.7715). Get your $AUDUSD market update from @DavidJSong here:https://t.co/EIQ7utBH9A https://t.co/RcWf6JgYX5
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 87.64%, while traders in EUR/USD are at opposite extremes with 70.33%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/EhQn4EqJYE
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Silver: 0.06% Gold: -0.03% Oil - US Crude: -1.48% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/ALjM4GEwOj
Yuan Runs to Resistance ahead of Trade, CPI Reports

Yuan Runs to Resistance ahead of Trade, CPI Reports

Renee Mu, Currency Analyst
Yuan Runs to Resistance ahead of Trade, CPI Reports

Fundamental Forecast for the Yuan:Bearish

The Chinese Yuan extended losses against the U.S. Dollar for the third consecutive week in the offshore market, although it has not yet broken the key resistance level of 6.8980. Looking forward, a heavy Chinese calendar is dotted with foreign reserves, exports and imports, Consumer Price Index (CPI) and New Yuan Loans. This has the Yuan at risk from home.

Chinese official and Caixin PMI reads for April released this week have already revealed producers’ difficulties. However, the economy may face a slowdown in a larger scope. According to estimations, in April, exports and imports weakened, Producer Price Index continued to drop, CPI improved slightly, and newly-issued credit declined. Despite that improvements were seen in the first quarter, China’s economic growth is expected to drop in the rest of 2017. Within such context, unless there is a big surprise in the prints to be released next week, the economic gauges are less likely to provide much support to the Yuan.

At the same time, policymakers seem to run out of new tools to further stimulus the economy. On one hand, the State Council has already announced a 380 billion Yuan tax cuts plan on April 19th, following the introduction of a 200 billion Yuan reduction on fees in the first quarter. On May 3rd, the Finance Ministry and the Taxation Department released detailed measures for tax cuts, marking it as the official implementation. Yet, this doesn’t mean companies can remove a total of 380 billion Yuan burden on their shoulders immediately; it will be lifted gradually and thus the eventual outcome could take months to show. In 2017, China set the targeted fiscal deficit ratio to be 3%, which is the highest level on record. Even if the country wants to use more fiscal stimulus, it has to be cautious about potential risks coming from cutting fiscal income further and putting on more debt.

On the other hand, the PBOC continued to manage liquidity in the financial system in a delicate way, through open market operations. The regulator has reiterated several times that it will keep monetary policy neutral, ruling out a possibility of using easing measures to support the economy before the price bubble risk is fully curbed. The April New Yuan Loans and home loans prints to be released on May 10th will give some update on this. These gauges have been used to evaluate whether excessive cash has flown into the housing sector, where the price bubble risk is seen the most.

In addition to the Dollar/Yuan rate, the Bitcoin/Yuan price is worth to keep an eye on as well. On Friday, the BTC/CNY hit a record high after the BTC/USD went on a record-breaking run for a week. Unlike the Japanese regulator that said yes to further Bitcoin development, or the U.S. regulator that said no but keep the door open for a yes, the Chinese regulator sent out a clear signal that China is not ready to have a digital currency to be used widely, even not to have a digital currency invented by itself. These mixed attitudes have Bitcoin exposed to different risks in its three largest markets and in turn elevate its volatility.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES