The RMB Has Been Down Two Days For &Nbsp, And It Is Difficult To Change The Expectation Of Market Appreciation.

Following the closing of the yuan against the US dollar yesterday, the biggest one-day decline in five and a half months, due to the lack of liquidity in the US dollar due to the early appreciation of the yuan, the central parity and closing price of the yuan declined slightly again yesterday. However, the NDF market shows that the trend of long-term appreciation of RMB is unchanged.

RMB central parity fell for two consecutive days

The middle price of the RMB against the US dollar was 6.5173 yesterday, and the middle price of the last day was 6.5161 derogatory 12 basis points, which was two consecutive.

Yesterday's spot inquiry trading system, the US dollar to the RMB closing price reported at 6.5287, compared with the previous closing price also slightly derogatory 10 basis points, all day in 6.52 above the paction, the highest price is 6.5203, the lowest price is 6.5405.

"The appreciation of the renminbi has been too fast for some time, and the agencies of the customer disk have tried to convert the US dollar into RMB, and the US dollar position in the organization is not ample, coupled with the decrease in the settlement of foreign exchange during the holiday period in Europe and the United States, and the liquidity of the US dollar in the market is seriously insufficient."

A foreign exchange trader at a bank in East China said.

Overseas no gold delivery market, Beijing time 17:36, the dollar to the RMB NDF 6.3298/32 in a year, the last day at 6.3220, indicating that a year after the renminbi will be appreciated by 3% relative to the dollar.

"Policy makers have to rely more on exchange rate instruments than ever before, because the US dollar has deliberately maintained low interest rates to support exports," said Mr Ba Shu song, deputy director of the Financial Research Institute of the State Council Development Research Center, Shanghai. "The US dollar has been pushing up the price of goods in large numbers, and China's import inflation pressure has increased."

Ba Shu song believes that "vegetable prices fell rapidly in April, and the next inflationary pressure comes from imported inflation, China.

Rosetta Stone Advisors Ltd director Xie Guozhong said on the same occasion that although the market generally expected that the renminbi will appreciate, it is easy to change this expectation, but after all, it is not the problem of hot money inflow, but the issue of capital flight.

China and the United States will

The US dollar index remained hovering near the low point of nearly three years yesterday, while Beijing time at 19 hours and 05 points reported a decrease of 0.31% at 73.86.

The euro hit a 16 month high of 1.4650 against the US dollar.

"The US dollar index will continue to bear pressure, because the market expects that the Federal Reserve will remain low interest rates for a long time."

Shenyang Wanguo Futures (Hongkong) joint director Zhang Minjie said.

Recently, the trend of precious metals, especially silver, has been in a state of madness. Following Monday's close to the 50 US dollar / ounce mark, it suddenly rose sharply after a sharp rise of 8%. Since the implementation of the Federal Reserve's QE2 policy, silver has surged by about 150%.

International spot gold also fell back to $1500 / ounce yesterday.

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On Thursday, the Federal Open Market Committee (FOMC) will announce the contents of the conference on interest rates. Federal Reserve Chairman Bernanke will also hold a press conference.

At present, the market generally believes that the Fed's quantitative easing measures are hard to quit and keep the low interest rate policy unchanged.

The US Treasury Department said Monday (April 25th) that the United States and China will hold high-level talks in Washington on from May 9th to 10th, and that exchange rate and debt problems may become the main topic of the dialogue.

Related news

JP Morgan Li Jing: this year the renminbi appreciated by 5% to 7% against the US dollar.

Morgan, managing director of China and China's global market chairman Li Jing, said in Beijing in April 26th that JP Morgan expects the US Federal Reserve to raise interest rates early next year, as the US economy has seen a steady downward trend in the past one or two months.

At the same time, she also believes that China's foreign reserves investment should be more diversified in the next few years and should not be confined to the relatively low risk of US Treasury bonds and euro zone government bonds.

Foreign investment should focus on commodity and physical investment, which can be invested overseas in US dollars or foreign currencies.

On the current domestic inflation situation, Li Jing said that inflation is still at a high level in the coming months, but the rise in global commodity prices is not the only reason for domestic inflation.

She believes that in the first 18 months of 2009 and the first half of 2010, the domestic money supply and bank loans were relatively large. The United States adopted the second round of quantitative easing policy to make the dollar overflow and push up commodity prices, and the rising labor costs in China all contributed to the high inflation rate.

Under the current inflation background, Li Jing believes that the central bank will raise the deposit reserve ratio and interest rate once in the second quarter and continue to tighten its monetary policy.

Government regulation is more frequent and rhythm quickening, but the scope is small.

"This year, we expect that the appreciation of the renminbi against the US dollar will be higher than last year, estimated at 5% to 7%," she said.

The reasons for inflation are manifold, and the government's policies and countermeasures are manifold. "