Short USD/CNH: Raise conviction level to 4/5: Foreign Exchange - ASEAN/Asia ex-Japan

Research evidence excerpt

Short USD/CNH: Raise conviction level to 4/5: Foreign Exchange - ASEAN/Asia ex-Japan

Global Markets Research

30 July 2026Strategy Trade

Foreign Exchange - ASEAN/Asia ex-Japan

Research Analysts**ALERT** Short USD/CNH: Raise conviction level

Asia FX Strategyto 4/5

Craig Chan - NSL

Passing of the FOMC, the drift lower in USD/CNY fixing, asymmetric sensitivity craig.chan@nomura.com

to USD, robust trade settlement, potential foreign inflows, US-China relations. +65 6433 6106

Trade: We raise the conviction level on our short USD/CNH position to 4/5 (from 3), Wee Choon Teo - NSL

targeting 6.55 (~3.0% gain) by end-October. Our conviction level was last raised to 3/5 weechoon.teo@nomura.com

(from 2) on 16July. +65 6433 6107

At this juncture, we see less supportive factors for USD in coming weeks, following a no- Vicky Chen - NSL

hike decision at the FOMC and what was viewed as a dovishWarshpost-meetingpress vicky.chen1@nomura.com

+65 6433 6540conference. Reasons for our USD view include: 1) US macro/policy outlook in the near

term may not justify the relatively high pricing for the 15 September FOMC meeting. Our Manthan Shingala - NSL

economists do not expect June core PCE (30 July) or July core CPI (12 August) to manthan.shingala1@nomura.com

surprise markets to the upside, and the market already views the US economy as strong, +65 6433 6427

highlighting some asymmetric risk to the July NFP release (7 August); 2) views around the

Fed losing credibility/independence are building; 3) we remain watchful of tech/AI-related

risks, especially if flows to US equities weaken; 4) some long USD positioning that may be

unwound; and 5) US-Iran conflict, where Trump is likely to limit any severe escalation and

FX markets have become less sensitive to oil price gains.