There Is No Significant Devaluation Of The RMB Central Parity.

According to the latest data from China foreign exchange trading center, the central parity of RMB against the US dollar in March 4th was 6.1236, down 46 basis points from the previous trading day, and hit a new low for the year, falling to the lowest level since last December 6th.

He Liping, director of the Institute of international finance, Beijing Normal University, said yesterday in an interview with reporters that the devaluation of the renminbi after February this year is a callback to the unilateral appreciation of the RMB against the US dollar last year. In 2013, the exchange rate of RMB against the US dollar has been in a unilateral appreciation. China's economy has also seen a downward trend. The US economy is basically in a relatively stable position. From any price trend, it is a regular phenomenon after a period of appreciation, and this decline is only a small range.

Regarding the recent fluctuations in the RMB exchange rate, Yi Gang, member of the CPPCC National Committee and director of the State Administration of foreign exchange recently said in an interview with reporters that the recent fluctuation in the RMB exchange rate market is normal, and that the two-way fluctuations in the future exchange rate market will become a norm.

In response, Wang Jun, deputy director of the Advisory Department of China International Economic Exchange Center, told reporters that RMB rate Recent volatility is a short-term phenomenon. The recent devaluation of the renminbi has broken the expectation that the market has been on the rise, and it has certain advantages for the market to form the two-way fluctuation of RMB. At the same time, it is also a strong blow to a large number of arbitrage capital inflows since the strong RMB last year. It has a positive effect on China's macroeconomic stability and the independence of monetary policy.

For the future trend of the renminbi, these experts generally believe that the renminbi does not have the conditions for a significant depreciation in the future.

He Liping pointed out that the most important factor affecting the exchange rate is the balance of payments. At present, China's trade and current account are showing a large surplus, and foreign exchange reserves are also increasing. Therefore, no significant factors can cause the RMB exchange rate to continue to depreciate in the future.

Of course, it is worth noting that the decline of the RMB exchange rate came after the US decided to withdraw from the QE gradually, and the relationship and influence between them are still widely concerned by the market.

In this regard, He Li Ping It is pointed out that the withdrawal of QE from the US does not lead to the return of international funds to the offshore market, but its impact on the overall exchange rate is still limited.

He Liping pointed out that although the domestic economy has downward pressure, it is basically in a stable position and has no tendency to continue downward. In addition, even if there are some speculative arbitrage, once the RMB exchange rate against the US dollar has depreciated for a long time, the RMB exchange rate will not depreciate and lose control like the emerging market countries because of the large amount of foreign exchange reserves in China. Therefore, it is unlikely that the RMB exchange rate will continue to depreciate in the future.

Wang Jun also pointed out that the RMB is still in the rising cycle in the future. "In the medium to long term, in the next 3-5 years, as China's economic strength continues to grow and its structural adjustment continues to improve, the Chinese economy will show a trend of rapid growth, so the performance of the renminbi will not be too bad."

In addition, the expected increase in the RMB exchange rate volatility, or to lay a good foundation for expanding the range of fluctuations, the market seems to have reached a consensus.

Some market participants suggested that the fluctuation rate of RMB exchange rate should be expanded from 1% to 2%, and then expanded to 5%.

In this regard, analysts pointed out that for the short term Arbitrage fund It is more difficult to grasp the time of entering and leaving the market after the expansion of volatility, and will face greater risks.

Wang Jun said that the two-way fluctuation of the RMB exchange rate is expected to create conditions for further expansion. However, considering that the expansion of the volatility may aggravate the unilateral appreciation and depreciation trend of the RMB exchange rate in the near future, it will help to increase the possibility of falling. Therefore, it is most prudent to temporarily expand the volatility to 1.5%, and further expand the retry later.

According to the reporter, at present, the expected time for the market to expand the volatility of the RMB exchange rate is that the central bank will soon expand the volatility of the RMB exchange rate in the second quarter and the latest in the fourth quarter of this year.

Lu Zheng commissar, chief economist of Industrial Bank, pointed out that with the withdrawal of QE from the US Federal Reserve, the US dollar rally is a major trend. Now time is no longer waiting. Only by expanding the fluctuation range can the RMB have enough flexibility. Otherwise, it can not achieve two-way fluctuations through devaluation, but will continue to appreciate.