Chinese domestic demand likely eased in April, retail sales and industrial production growth to have slowed

Chinese domestic demand is likely to have eased in April. The NBS manufacturing PMI fell to 50.1 from March’s 50.5. According to a DBS Bank research report, retail sales and industrial production growth are likely to have weakened to 8.6 percent and 6.5 percent year-on-year in April, respectively.

Meanwhile, fixed asset investment growth is likely to have risen to 6.4 percent from 6.3 percent on the back of accommodative monetary policy and fiscal support. The Chinese central bank extended CNY 267.4 billion to commercial banks in April through its targeted medium-term lending facility for channelling funding to sectors in greater demand for funding.

“Looking ahead, the consumption sentiment and industrial activities will continue to be cloudy due to external uncertainties. More stimulus policy, especially on the monetary front, such as further cut in reserved required ratio is still on the card”, added DBS Bank.

At 18:00 GMT the FxWirePro's Hourly Strength Index of Chinese Yuan was highly bullish at 105.023 while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -26.4909 more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex