USD/CNY Drifts Upwards as China GDP Data Looms
The USDCNY pair has increased on Monday as investors anticipate the upcoming China GDP data, scheduled for release on Tuesday. The pair reached a high of 6.87, a few points above Friday's low of 6.8346.
The release of China's GDP data looms and the USDCNY pair drifts upwards as investors anticipate a positive economic growth rate for China. However, ongoing tensions between the US and China continue to cause uncertainty in the markets, and the situation is being closely monitored. The coming days could be critical for the future of the USDCNY pair and the global currency markets as traders wait for further developments.
China GDP Preview
Recent flash economic numbers show that the Chinese economy is performing better than expected. The housing sector, in particular, is making strides, with new home prices jumping 0.5% in March, the fastest growth in 21 months. Other reports show that sales of electric vehicles in the country have also surged, and energy consumption has jumped sharply in the past few weeks.
Expectations for China GDP Data
Economists polled by Reuters predict that the upcoming China GDP data will show a 2.2% month-on-month expansion in the first quarter, translating to a 4.0% year-on-year increase, which is higher than the previous quarter's 2.4%. These numbers will provide an indication of whether the country's economy has recovered after abandoning its Covid-zero strategy.
China's Economic Outlook
After the country reopened, the IMF expects the Chinese economy to grow by 5.6% in 2022, which is more optimistic than Beijing's target of 5.0%. The anticipated growth is a testament to the country's resilience and the effectiveness of its recovery efforts.
USD/CNY Chart Analysis
The USD/CNY pair has been trading sideways, remaining steady at 6.87 and consolidating between the 50% and 38.2% Fibonacci Retracement levels. The pair is also consolidating at the 50-day and 25-day exponential moving averages. Investors will reflect on China's and America's economies, with the pair likely to continue consolidating before having a bearish breakout, with sellers targeting the key support at 6.820.
The Impact of China GDP Data on Forex Trading
China's GDP data is one of the most significant events that affect forex trading. Traders use this data to gauge the health of the Chinese economy and make investment decisions accordingly. The anticipated growth in the Chinese economy is expected to influence the USD/CNY pair's movements in the coming days. Forex traders will be closely watching for any surprises in the China GDP data that may impact the forex market.