China Weekly Dynamics

China's economic data for June continues to show domestic demand weakness, contrasting with strong external trade. The PBoC is moving toward more precise liquidity control via overnight reverse repos to stabilize financial conditions.

Key Takeaways

• 1.Macroeconomic weakness persisted into June with a divergence between weak domestic demand and strong external trade.
• 2.The CNY shows resilience against the USD despite a hawkish Fed, supported by a strong external balance.
• 3.The PBoC is preparing to debut overnight (ON) reverse repos to improve short-term liquidity management.

Table of Contents

• Macro: weakness into June before a likely better H2
• The CNY resists the USD, likely new ON reverse repos
• Asset overview and flows
• Macro: Trade dynamics
• Macro: demand and supply snapshot
• Macro: Prices and inflation
• Macro: monetary and fiscal condition
• FX market: Market dynamics
• FX market: Macro Fundamentals
• FX market: Forwards & options
• Fixed income market: Performance
• Fixed income market: Money market and liquidity
• Fixed income market: Primary market
• Fixed income market: Interbank bond holding
• Calendar
• Emerging Markets Research advanced tools
• Red Mount Analytics

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