Reuters with more on the CNH short squeeze that has seen borrowing rates for overnight offshore yuan soar

China's offshore yuan implied overnight deposit rate hit a record high of 94 percent in Hong Kong in volatile morning trading on Tuesday

"There's still a lot of swap squeezing going on. The funding for the swap positions is being squeezed by the central bank interventions via Chinese banks that used to be main liquidity providers of the offshore yuan," said the head of FX trading at an Asian bank in Hong Kong.
"It will last for a few days and perhaps we'll see some relief later this week as a lot of short yuan positions will be forced to be squared within days."

Suspected interventions in the offshore yuan market have pushed up the offshore spot rate to almost the same level as the onshore rate. The spread between the two rates hit more than 1,600 pips last week.

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