Chinese Yuan: Neutral tone within tight band against US Dollar – UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann keep a neutral stance on USD/CNH, expecting intraday consolidation between 6.7760 and 6.7880 after recent directionless trading. On a 1–3 week horizon, the pair is seen holding a broader 6.7620–6.7980 range. Over 1–3 months, they anticipate USD/CNH will continue grinding lower, though it is uncertain whether the 2023 low at 6.6980 will be reached.

Range trading as broader downtrend lingers

"24-HOUR VIEW: USD dipped to a low of 6.7690 two days ago and then recovered. When USD was at 6.7780 yesterday, we indicated that “we do not observe any increase in downward momentum,” and we expected USD “to trade in a range between 6.7700 and 6.7840.” We continue to expect range-trading but the slightly firmer underlying tone suggests a higher range of 6.7760/6.7880."

"1-3 WEEKS VIEW: We turned neutral on USD last Thursday (04 Jun, spot at 6.7750), and we indicated that USD “is likely to trade between 6.7620 and 6.7980 for the time being.” Since then, USD traded in a directionless manner, holding within our expected range, and we maintain the same view for now."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)