The big mover overnight has been the Cny ndf curve on the back of the following article, linked below , highlighting the Chinese authorities are allowing offshore Yuan to be repatriated back to the mainland.
This has led to a squeeze to the right for the offshore CNH curve and this has dragged the NDF curve higher with it.. The implications for the various curves will mean the discrepancies resulting from the existing capital account restrictions will be ironed out as the regime is liberated.
Currently there exists 510bn of offshore Yuan deposits, but only 120bn of Dim Sum bonds. Therefore issuance of Dim Sum bonds is only going to increase going forward as the offshore borrowing costs as compared to onshore rates are lower, and there is a mismatch between supply and demand.
The table below gives a snapshot of the current curves . I would advocate the 6 month of the NDF curve has fully converged and would look to sell this bucket if one was looking to establish or add to $ shorts.
Westpac Banking Corporation