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Can the PBOC turn the tide for China? The AUD/USD hopes it can

The recent rebounds across the Chinese stock markets has clear evidence of official intervention now, as was reported on here yesterday. As also noted, prior to that there was also clear evidence here (reported to you) of more covert actions. Well, now that the genie is out of the bottle, it remains to be seen if Chinese authorities can stem the outflow from the Chinese equity markets. We have now seen some of the top Chinese regulators fired and replaced and that comes after what has been a total failure of the authorities to stop their own investors from fleeing the markets. We know those investors have been buying stocks elsewhere too. The question now is what lies in store for Chinese markets? All I can say on that, is that water usually finds its own way downhill. I will leave it at that. Meantime, the most sensitive currency to the Chinese economy is still watching on with nervous trepidation- the Australian dollar. The AUD/USD closed in the US last night at 0.6520. It has traded a range today covered by 0.6506 to 0.6532. Perhaps we should not forget the Chinese lunar New Year holidays will soon be upon us and perhaps this official support comes at a timely moment in the calendar. The AUD/USD is currently trading at 0.6508
 

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