Decoding The Different Logic Of RMB Depreciation

< p > in early 2014, the RMB reversed against the US dollar since the fourth quarter of last year, with a slight depreciation and accelerated devaluation after the Spring Festival.

Since the beginning of 2014, the RMB has depreciated by 1.5% against the US dollar, which has depreciated by 1.3% after the Spring Festival.

According to the data of the safe, in January 2014, the sales of foreign exchange on behalf of the banks amounted to 76 billion 300 million US dollars, which is at a relatively high historical level. It shows that capital inflows are more, but why is the RMB depreciating? < /p >

In the first half of 2012 and the middle of 2013, the RMB depreciated against the US dollar in the first half of 2012 and the middle of the year. At that time, the background of China and abroad was the downward pressure on China's economy and the tightening of overseas liquidity.

Compared with the first two times, we believe that this round of RMB depreciation is not a purely endogenous factor.

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＜p＞　　從＜a href="http://www.91se91.com/news/index_cj.asp"＞內生性＜/a＞因素分析，首先，通常中國經濟增速放緩之時，人民幣＜a href="http://www.91se91.com/news/index_cj.asp"＞匯率＜/a＞呈現升值放緩或貶值的態勢，自2013年12月以來，中國經濟增速放緩趨勢較為明顯，并持續到2014年前兩個月，同時疊加地方政府債務問題、房地產和影子銀行問題，加大了海外投資者對中國經濟“硬著陸”的擔憂，加之貿易順差季節性規模下降，都會推動人民幣匯率貶值;其次，年初以來，國內流動性整體寬松，特別是春節過后現金回流導致流動性較為充裕，市場收益率下行明顯，導致國內外利差收窄，投機資金套利空間減少，也引發部分資金流出，助推人民幣貶值;最后，從海外流動性分析，美聯儲持續削減QE規模，引發部分新興經濟體匯率大幅貶值，雖未對中國形成規模化資本流出的影響，但海

The decline in risk preference of foreign investors may lead to a more secure asset preference for developed economies.

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< p > but endogenous factors can not fully explain the depreciation of < a href= "http://www.91se91.com/news/index_cj.asp" > RMB exchange rate < /a > since 2014.

In the course of the first two rounds of RMB devaluation, the expectation of depreciation based on the overseas RMB NDF is rising rapidly. From the end of 2013 to the beginning of 2014, the devaluation of the RMB is always at a low level.

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< p > in analyzing the framework of RMB exchange rate, an indispensable factor is the attitude of the central bank to the exchange rate and possible market intervention.

Although we can not accurately judge whether this round of RMB devaluation is from the open data, the central bank intends to do so, but we generally believe that the current situation of RMB depreciation is favorable to the central bank.

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On the one hand, on the one hand, the appreciation of the renminbi in the early stage caused a large amount of "hot money" inflow. The central bank's actions to prevent the RMB's excessive appreciation and passively put in a large amount of liquidity were contrary to the policy of maintaining a tight neutral monetary policy.

At the same time, the moderate depreciation of the RMB will help to reduce the risk free profit margins of cross-border arbitrage funds and reduce the "hot money" inflow. On the other hand, after the rapid appreciation of the RMB at the end of 2013, the moderate depreciation of the RMB exchange rate will help to break the pre appreciation period of RMB appreciation and raise the elasticity of RMB exchange rate, so as to provide necessary conditions for further relaxing the floating range of exchange rate, realizing two-way fluctuation and promoting the market-oriented reform of exchange rate.

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< p > based on the above analysis, we believe that the RMB exchange rate will continue to depreciate or fluctuate in the short term. However, from the medium to long term analysis, China still has current account surplus, huge stock of foreign exchange reserves and capital account control, and the pressure of net inflow of foreign exchange funds may exist for a long time. The implementation of comprehensive deepening reform will help enhance the confidence of the international community in China's economy, and China is still an important investment destination for global capital. The continuous promotion of RMB internationalization also needs stable and relatively strong RMB exchange rate.

On the whole, we expect that the RMB will continue to appreciate slowly in 2014.

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