HENGY

China's National Financial Regulatory Administration has verbally instructed major banks to suspend new yuan-denominated loans to five U.S.-sanctioned Iranian oil refiners, including Hengli Petrochemical, creating tension with a simultaneous Commerce Ministry directive telling firms to ignore U.S. sanctions. The PBOC set its yuan fixing at 6.8487 per dollar, the strongest level since March 2023, with MUFG attributing Asian currency gains to reduced Middle East escalation risk. China's Labor Day holiday consumer spending rose 14.3% year-on-year, though economists at Societe Generale and Pantheon Macroeconomics flagged structural headwinds including weak labor markets and property sector drag as likely to limit any sustained recovery.