USD/CNY: Downward pressure on Yuan to persist before economic growth gains a solid footing – Commerzbank

USD/CNY has hovered around 7.30 since mid-August. Economists at Commerzbank analyze the pair’s outlook after today’s official PMIs for October unexpectedly fell.

Weak PMI

The official manufacturing PMI fell below the 50 neutral mark to 49.5 after it increased to 50.2 in September. Further, the official non-manufacturing PMIs for October eased back to 50.6 from 51.7 in September.

The downward pressure on CNY will likely persist before economic growth decisively gains a solid footing. In the meantime, PBoC is likely to continue to target CNY stability.