Yuan steady as China PMI increases after months of gloom

The Chinese yuan remained relatively stable as December began with good news from China’s economy.

China’s Purchasing Managers’ Index (PMI) was at 51.8 in November, up from a reading of 51.7 in October.

On Friday, the National Bureau of Statistics (NBS) released an official manufacturing PMI reading of 50.2. It topped the 50 levels-suggesting an expansion for the first time since April.

The PMI highest had been 54.4 since March.

The USD also stayed steady in Asia after the release of robust economic data in the US the previous week.

The US Dollar Index traded marginally higher early in the day, up 0.03% to 98.20 by 01:40 GMT.

Focus remains on US-China trade talks

Focus remains on US-China trade talks after Global Times tweeted that any phase one deal required the US to roll back tariffs.

The next batch of America’s tariffs in Chinese goods is due to take effect on Dec 15.

Global Times is China’s English language tabloid, which links to the Communist Party of China.

Last week the US President Trump approved two bills to support Hong Kong protestors against the government.

The two laws have limited practical implications, therefore just symbolic. But, China has vowed to take strong retaliatory measures, although it hasn’t announced specific measures yet.

The People’s Bank of China (PBOC) set the reference rates for the yuan at 7.0262, slightly weaker than last Friday’s 7.0247.

The GBP/USD pair dropped 0.14% to 1.2915. The GBP had taken several hits recently as polls continued to suggest that Boris’s Conservative Party was likely to win the Dec 12 elections- paving the way for a speedy Brexit.

The EUR/USD rose 0.4% to 1.1018.

The USD/JPY pair also rose 0.16% in the morning trade to 106.69. Signs continue to point towards more easing from the Bank of Japan.

The AUD/USD pair rose 0.16% to 0.6774.

The NZD/USD pair also rose 0.37% to 0.6444.