Trump Lifts 25% Tariff on Indian Goods in Strategic U.S.–India Trade and Energy Deal 
Japanese Pharmaceutical Stocks Slide as TrumpRx.gov Launch Sparks Market Concerns 
Dollar Near Two-Week High as Stock Rout, AI Concerns and Global Events Drive Market Volatility 
India–U.S. Interim Trade Pact Cuts Auto Tariffs but Leaves Tesla Out 
Asian Markets Surge as Japan Election, Fed Rate Cut Bets, and Tech Rally Lift Global Sentiment 
South Africa Eyes ECB Repo Lines as Inflation Eases and Rate Cuts Loom 
U.S. Stock Futures Rise as Markets Brace for Jobs and Inflation Data 
Asian Stocks Slip as Tech Rout Deepens, Japan Steadies Ahead of Election 
China Extends Gold Buying Streak as Reserves Surge Despite Volatile Prices 
Bank of Japan Signals Readiness for Near-Term Rate Hike as Inflation Nears Target 
The USD/CNY currency pair is expected to reach a level of 7.10 by the end of this year as overall growth trajectory is seen moderating over the next few quarters.
China’s economy grew 6.9 percent y/y in the first quarter of 2017, one notch higher than market expectations and well above the growth target of 6.5 percent. On a seasonally adjusted basis, the economy expanded by 1.3 percent in the quarter, compared with 1.7 percent in the previous quarter.
Notably, China’s investment accelerated in Q1 while consumption softened. Fixed asset investment grew 9.2 percent y/y in Q1 2017, up from 8.3 percent y/y in 2016. Retail sales slowed to 10.0 perrcent in the first quarter of 2017, compared with a 10.4 percent gain throughout 2016. As investment accelerated, industrial production also sped up to 6.8 percent y/y in Q1 2017, up from a 6.0 percent growth for 2016.
However, it is highly unlikely that the country’s investment will remain elevated for a longer time. Also, it appears that the momentum of producer price inflation will continue to be on the upside in the near term.
"Fundamentally speaking, CNY is still under pressure to weaken, given China’s struggling economic rebalancing, rising risks of an asset bubble and the poor return of CNY-denominated assets. We, therefore, think CNY will weaken by another 3 percent over the remainder of 2017, and USD-CNY will reach 7.10 by the end of this year," Commerzbank commented in its latest research report.
