Very much agree with @michaelxpettis on this.
The CNY is still a heavily managed currency and its moves reflect policy choices.
The CNY is still a heavily managed currency and its moves reflect policy choices.
@michaelxpettis Yes, hot outflows are up this year. But modestly. And the trade surplus is also up. There is no real pressure on China's reserves. Data on the fx intervention proxies is through September. 
@michaelxpettis Settlement showed small sales in September, but nothing that China cannot handle -- and frankly the sales are quite modest relative to the CNY moves this year (I view their modest size as evidence that the authorities are still in control)
@michaelxpettis and not quite sure where Natixis is getting their $90b in outflows in September estimate. There is an outflow in settlement, and a gap v the goods surplus -- but it isn't $90b
@michaelxpettis There is still a connection between the CNY and sales in settlement (when CNY weakens, China has to sell a bit) but the magnitude of the sales are WAY smaller than in 15-16.
@michaelxpettis And with the an imminent deal and the dollar's recent move down the CNY now can rise against the dollar w-o rising v the basket --
