A supercharged economic data report has bolstered confidence in the strong rebound of China's economy.

A rapid and significant rebound has shattered the dreams of short-sellers, with the Chinese yuan surging by over 1,200 points.

An unanticipated wave of buying has witnessed global capital over-allocating to Chinese assets, with a fervor for scooping up yuan.

01, The yuan soars by 1,200 points

Last week, with a total of five trading days, there was a continuous four-day decline in the offshore exchange rate of the yuan against the US dollar. Amid that relentless downward trend, the yuan's exchange rate was on the verge of breaking below 7.0 again, with last Friday's lowest point reaching 6.9827, and on this Monday, the yuan continued to fall to 6.9896.

At this point, the market even chanted slogans to defend the 7.0 level, but unexpectedly, the yuan rose in the following three consecutive trading days of this week, especially yesterday, with a single-day increase of 750 points.

From the lowest point at the beginning of the week to yesterday's highest point, the yuan's appreciation exceeded 1,200 points.

A single day's rise almost reclaimed all the declines of the previous week.

Not only did the yuan not break seven again, but it also shattered the short-selling forces against the yuan with this rapid increase.

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02, PMI IndexIn fact, the appreciation of the Chinese yuan was anticipated. When it was close to breaking 7.0 the day before yesterday, I had already mentioned that this was just a short-term fluctuation, and it would continue to appreciate in a two-way fluctuation in the future.

After Monday, I also predicted in my article that the yuan would not break 7.0 in the short term and was slowly moving away from 7.0.

However, it was unexpected that such a strong rise occurred on Wednesday, mainly due to a significant economic data release from China, showing a strong recovery from previous contraction to current expansion.

That is the PMI index that the market is very concerned about.

From the PMI index announced this time, which is as high as 52.6, we can see a clear difference from the past. It not only reached the highest point in the past year but also obviously got rid of the influence of the previous fluctuating box.

03, Global capital buys Chinese assets

In contrast, the United States also released similar data, with the Markit manufacturing PMI for February at 47.3, lower than expected and far below the 50 boom-or-bust line.

European countries have also announced this index one after another. The entire eurozone is at 48.5. Looking at individual countries, Germany is at 46.3, France is at 47.4, and the UK is also below 50, only at 49.3.

That is to say, at present, all European and American countries have entered a state of economic contraction.

In this situation, global financial capital will inevitably flow to the place with the best economic investment expectations. Therefore, the news of buying Chinese assets has been incessant during this period.Yesterday in the A-share market, the net inflow of Northbound capital reached 7 billion yuan, marking the second highest level since February, and also reversing the consecutive net selling that had occurred over the previous five trading days.

An even more impressive performance was seen in the Hong Kong stock market, where the Hang Seng Index surged by 4.2% due to the continuous inflow of funds, and the Hang Seng Tech Index even rose by 6.64%.

Clearly, buying Chinese assets in the Hong Kong stock market faces fewer restrictions and is more suitable for rapid accumulation over a short period, which is why the Hong Kong stock market experienced an explosive increase yesterday.