CHINA RETURNS FROM ELONGATED BREAK With Chinese market participants away, given the market holiday, the offshore Yuan (CNH) is trading at its largest discount (700pips) to the onshore (CNY) since the beginning of 2016. As such, with China returning from its elongated break, eyes will be on the Yuan mid-point overnight. Signs that China is content in allowing the Yuan to depreciate would leave topside resistance in USDCNH exposed at 7.16 where a breakthrough would leave both emerging and commodity currencies vulnerable.