The Chinese Yuan is under renewed selling pressure again today. USD/CNH (offshore Yuan) rises to as high as 6.921 so far and breaks 6.912 resistance. The development is apparently dragging down Chinese stocks, with Shanghai SSE down -1.32% at the time of writing. Asian indices are all affected, with Nikkei down -0.38%, HK HSI down -1.52% and Singapore Strait Times down -0.21%. Australian Dollar also suggests deep selling, partly due to such development.
Now USD/CNH is on course to have a test on key resistance level at 6.9871, 2017 high. It remains to be seen if the government will intervene more aggressively. If the Yuan is solely moved by market forces, we see no reason why USD/CNH will not break 7 handle.