USD/CNY: 6.32-6.40 neutral bias - BTMU

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 12, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Guatemala) - Analysts at Bank of Tokyo Mitsubishi explained that on balance, October data was marginally worse, as implied by the contemporaneous stock market reaction.

    Key Quotes:

    "So our recipe remains: Weakening economy, means no stabilization of economic expectations, means capital keeps flowing out, means intervention. And it’s still a long (= lots of reserves), losing (= sterilized intervention) grind higher. Maybe we’ll see more shock and awe from Big Brother next week. Bids onshore are suppressed; offshore trading is a signal of such bids. But don’t call these markets decisive; more like stifled.

    Government fiscal expenditures are up more than 18%YTD, but no seeming stimulus impact. The local debt-for-bonds swap is up to CNY4trn in size (quadrupling from its initial announcement). No one seems to see the connection."
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