While the PBoC has continued to impose daily fixings significantly stronger than market estimates based on the fixing formula, they prevented a sharp depreciation of CNY but did not reverse the weakening trend. 

CNY will likely remain under pressure for the rest of this year. We will likely only see a rather moderate boost to growth from policy stimulus in the coming months. Slow growth also speaks in favor of a loose monetary policy. The wide, negative China-US yield spreads will therefore remain for longer.