0516 GMT - Chinese policymakers' comments provided some support to the CNH this morning, but a sustained recovery still appears distant, says OCBC's Christopher Wong. The verbal assurance offered a brief respite, as the PBOC raised cross-border funding limits from 1.50 to 1.75 and Gov. Pan announced plans to drastically raise China's FX asset allocation in Hong Kong, Wong notes. That comes after the PBOC's suspension of government bond purchases and its announcement to issue bills in Hong Kong to absorb offshore liquidity. "These efforts alongside steady fixing in onshore CNH (under 7.19) sent a strong signal that authorities are doing whatever it takes to maintain the relative stability in RMB," Wong says. However, he cautions that such measures alone are unlikely to alter the currency's trajectory. A softer USD, a stronger economy or a return of foreign investor confidence will be necessary for a meaningful turnaround, he notes. USD/CNH last stands at 7.3567. (fabiana.negrinochoa@wsj.com)
(END) Dow Jones Newswires
January 13, 2025 00:16 ET (05:16 GMT)
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