CNY: Chinese economic policies in focus – MUFG

FXStreet (Delhi) – Lee Hardman, Currency Analyst at MUFG, notes that the PBoC have set the daily fix for USD/CNY marginally lower for the second consecutive day which has brought an end to ten consecutive days of higher fixes.

Key Quotes

“As a result, Asian currencies have stabilized early this week after the Asian dollar index fell to a new cyclical low late last week. Asian and commodity related currencies have also derived support from reports overnight that the Chinese authorities will take further steps to support growth, including widening the fiscal deficit and stimulating the housing market.”

“According to statements released at the end of the government’s Central Economic Work Conference by the official Xinhua News Agency, monetary policy must be more “flexible” and fiscal policy more “forceful” as leaders create “appropriate monetary conditions for structural reforms”. We still expect economic growth to slow further in 2016 keeping downward pressure on Asian and commodity-related currencies.”

Lee Hardman, Currency Analyst at MUFG, notes that the PBoC have set the daily fix for USD/CNY marginally lower for the second consecutive day which has brought an end to ten consecutive days of higher fixes.

(Market News Provided by FXstreet)