USD/CNH under pressure as China Caixin Services PMI rises to 52.6

USD/CNH faces downward pressure as China's Caixin Services PMI rose to 52.6 in April from 52.1 in March, signaling accelerating expansion in the world's second-largest economy's services sector. Domestic demand remained the primary growth driver, offsetting weakness in new export orders, which declined for a second consecutive month amid escalating global trade disruptions linked to the Middle East conflict since late February. Business confidence improved notably, with forward-looking sentiment among the strongest recorded over the past year, suggesting sustained economic momentum ahead. The stronger-than-expected services data supports the Chinese yuan and commodity-linked currencies such as AUD and NZD, which benefit from improved Chinese economic activity. The People's Bank of China's ongoing accommodative stance combined with improving domestic fundamentals could provide further yuan support. Traders should monitor upcoming trade balance data and any escalation in geopolitical tensions, which could offset positive domestic momentum. AUD/USD and NZD/USD may see upside if risk sentiment improves on the back of resilient Chinese demand.