After the two-day low exchange rate of RMB against the US dollar hit a two-year low on the 2nd, on the 3rd, the performance of the RMB in the spot market was still falling all the way, with the largest intraday decline of 1.96%, which was the spot exchange rate for 7 consecutive trading days. The sixth time approached the limit. However, experts agree that...
After the two-day low exchange rate of the RMB against the US dollar hit a two-year low on the 2nd, the performance of the RMB in the spot market continued to fall all the way on the 3rd, with the largest intraday decline of 1.96%, which was the spot exchange rate for 7 consecutive trading days. The sixth time approached the limit. However, experts agree that the current RMB will not experience a trend of depreciation. Continuous approximation of the down limit is not the RMB "too weak"
"The current RMB exchange rate continues to decline. It is not that the RMB is too weak, but the US dollar is too strong. The sharp rise in the US dollar index is the main reason for the sharp fall in the RMB exchange rate." Zong Liang, deputy director of the Bank of China International Finance Research Institute, told reporters. Just a few days ago, the US dollar index once broke through the 95 mark, a record high in 11 years. As the US dollar rises, the corresponding RMB is bound to show downward pressure.
On the 3rd, the central bank slightly raised the central parity of the RMB against the US dollar to 6.1369. After the opening of the RMB against the US dollar, the exchange rate still fell sharply. It once fell to 6.2572, down 1.96% from the middle price.
Ding Zhijie, executive vice president of the Graduate School of the University of International Business and Economics, said that the RMB exchange rate against the US dollar is a normal response to the strengthening of the US dollar in the international foreign exchange market.
"Although the renminbi has fallen a lot against the US dollar, the major currencies such as the euro, the Swiss franc, the Australian dollar and the Japanese yen are rising, so the real effective exchange rate of the renminbi has not fallen." Zong Liang said that since October 2014, the euro has accumulated The depreciation exceeded 20%, the yen depreciated by nearly 15%, but the yuan only fell 2.2%.
"On a global scale, the decline of the renminbi is not large. And a moderate depreciation is conducive to promoting China's foreign trade and enhancing economic competitiveness." Zong Liang said.
Difficult to trend devaluation
Regarding the trend of the RMB that is most concerned about the market, many experts and market participants have said that it is difficult for the RMB to depreciate.
Xie Yaxuan, chief macro analyst of China Merchants Securities, said that despite the current economic downturn in China, the global economic growth rate is still relatively fast, with 3.84 trillion foreign exchange reserve support behind it, and no conditions for trend depreciation.
Lian Ping [microblogging], chief economist of Bank of Communications, believes that the current depreciation of the renminbi is relatively high, but the renminbi exchange rate is close to equilibrium prices, and it is not suitable for big gains. In addition, the RMB exchange rate is also constrained by the excessive trade surplus between China and the United States. "If the renminbi depreciates sharply, the United States will not agree." Lian Ping said.
Zong Liang also believes that the strengthening of the US dollar against major global currencies will inevitably have an adverse impact on US exports and trigger the opinions of the American public. The US Treasury Secretary clearly stated at the Davos Forum on January 23 that "the exchange rate concerns about China continue to increase." "In this case, even if the renminbi wants to lick too much, it will be difficult. The minimum will not break through 6.4." Zong Liang said.
Lian Ping expects that the RMB appreciation will not be possible in 2015, and it will not be possible to continue to depreciate substantially. The spot exchange rate will continue in 2014, and the range of fluctuations may be between 6 and 6.4.
Large fluctuations will become a normal market without panic
Due to the sharp decline in the 7th consecutive day, the RMB exchange rate has rapidly risen to the Internet hot word with extremely high click-through rate, and the public has shown great concern.
"What is more worrying than the depreciation of the RMB itself is the widespread expectation of RMB depreciation." Xie Yaxuan said.
Ding Zhijie said that the panic is mainly because they do not understand the difference between the middle price and the transaction price, and over-interpret or even misread the intraday trading price to depreciate the middle price. Interpreting the trading price against the mid-price depreciation of 1.9% as the renminbi exchange rate plummeted is a misunderstanding of the RMB exchange rate.
“The central parity of the RMB is more volatile, which will increase the volatility of the spot exchange rate. The impact of market supply and demand on the exchange rate is more significant.†Xie Yaxuan said, “The central bank’s purpose is to reduce intervention, and should not be understood as 'letting it go,' and should not be simple. It is believed that the RMB exchange rate should be intentionally 'depreciated'."
Zong Liang said that since last year, the central bank has gradually withdrawn from the normalization of the RMB exchange rate. Recently, the RMB exchange rate has been approaching the 2% maximum volatility, which means that the central bank intends to adapt the market to such large fluctuations. What is certain is that the large fluctuations in the RMB exchange rate in the future will be the norm.
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