USDCNH Goes Another Leg Lower; HFs Selling Swaps USDCNH went another leg lower to 6.3610, with the market likely taking a cue from the PBoC setting the USDCNY fix below 6.4000 and continued selling of USDs onshore. There is seeing two-way interest in USDCNH at these levels. Hedge funds continue to sell swaps, but they are well supported at current levels with tighter funding. Both spot and swaps should consolidate into the weekend.
Pace In EURUSD Downside Picks Up After a quiet morning in London, USD demand picks up with the US walking in. The pace in EURUSD downside picks up with the break of the uptrend going back to end March - 1.2165-70 area. As mentioned a couple of times before, month-end rebalancing interest could be part of the reason for the strength in greenback as the moves seem fairly isolated in FX and PM so far. Flows over the last few hours has been fairly balanced, with net small better USD buying.
Bid Tone For USD Vs. Asia FX USD vs. Asia FX is catching a bid tone after the local close. There has been similar price action to the last few days, with better USD buying interest when NY is walks in. Potentially some month-end interest involved as well after MSCI rebalancing was wrapped up last night. Flows are light so far across pairs.
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