U.S. and El Salvador Sign Landmark Critical Minerals Agreement to Boost Investment and Trade 
South Korea Industry Minister Heads to Washington Amid U.S. Tariff Hike Concerns 
U.S.–Venezuela Relations Show Signs of Thaw as Top Envoy Visits Caracas 
Wall Street Slips as Tech Stocks Slide on AI Spending Fears and Earnings Concerns 
Asian Currencies Trade Flat as Dollar Retreats After Fed Decision 
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
China Home Prices Rise in January as Government Signals Stronger Support for Property Market 
Wall Street Slides as Warsh Fed Nomination, Hot Inflation, and Precious Metals Rout Shake Markets 
Indonesia Stocks Face Fragile Sentiment After MSCI Warning and Market Rout 
South Korea Exports Surge in January on AI Chip Demand, Marking Fastest Growth in 4.5 Years 
Philippine Economy Slows in Late 2025, Raising Expectations of Further Rate Cuts 
Chances of USD/CNY firmly staying below the 7.00 mark still remains low, given the People’s Bank of China (PBoC) new fixing and monetary policy tactics, according to the latest research report from Commerzbank.
This morning, the PBoC surprisingly cut the rates for medium-term lending facility (MLF) by 5bps, the first cut since 2016.
As the MLF is now the base rate for the loan prime rate (LPR), the new loan benchmark rates, today's MLF rate cut looks like a "game changer" from a rates perspective.
However, given the 5bps cut is actually tiny, it might be fair to say the PBoC only fine-tuned its monetary policy stance. According to the report, today's tiny MLF cut seems be more interesting if taking a FX perspective.
Typically, a rate cut will bring depreciation pressure to the currency. That said, today's unexpected rate cut by the PBoC seems to hint that they believe the depreciation pressure on CNY, if there is any, is tolerable or even welcomed by the Chinese policy makers, Commerzbank further noted in the report.
