The Two-Way Fluctuation Of The RMB Exchange Rate Will Become A New Normal.

How do people view the rise and fall of the RMB exchange rate? Will the market of unilateral appreciation or depreciation occur again? How should enterprises control risks? Reporters interviewed the dean of the school of finance, foreign economic and trade university. Ding Zhi Jie 。

　　 Reporter: since June, the RMB exchange rate has seen a wave of appreciation, which makes some market participants believe that the RMB exchange rate will once again enter a long-term upward channel. What do you think is the reason for this round of market quotation? Is there any continuity in this market?

Ding Zhijie: this round of RMB. exchange rate Appreciation of the market is a comprehensive response to various factors.

First of all, this is related to the reform of exchange rate formation mechanism. For a long time, the RMB exchange rate as a whole has been on the rise. Financial institutions and enterprises have arbitraged foreign exchange through debt denominated foreign exchange, holding large amounts of Foreign Exchange bears. In March 15th, the RMB exchange rate increased from 1% to 2%, and the exchange rate elasticity increased. foreign exchange The exchange rate risk increased. In order to reduce exchange rate risk, institutions and enterprises buy foreign exchange and liquidate foreign exchange short positions, resulting in a significant depreciation of the RMB exchange rate in the early stage of reform. With the end of the transitional period, the RMB exchange rate began to stabilize and steadily appreciate.

Secondly, the Ukraine crisis has led to the increase of geopolitical risks. The major Asian currencies, including the renminbi, become one of the safe haven of international capital, and there has been a collective appreciation.

Once again, Shanghai and Hong Kong pass is a new measure of two-way opening of China's capital market, and the attraction of RMB assets to international capital is increasing. Hongkong is an international capital investment in RMB and access to the mainland. Since June, the Hong Kong dollar exchange rate has strengthened, indicating that a large number of international capital flows into Hongkong.

Export growth in July exceeded expectations is also a factor. In August, the trade surplus increased and increased the foreign exchange supply in the market. After the relevant data were released, the RMB exchange rate rose.

All these factors contributed to the appreciation of the renminbi. The appreciation of this round is not large, and the duration is not long. There is no obvious trend, and there is no large-scale hot money movement. With the disappearance of some factors and the change of economic fundamentals, the possibility of trend appreciation is very small.

　　 Reporter: the RMB exchange rate has experienced the most significant devaluation since 2005 in 3 and April. Will the two-way fluctuation of RMB exchange rate become normal in the future?

Ding Zhijie: in the future, there will be no unilateral appreciation or depreciation of the RMB exchange rate. Bilateral fluctuations will become the norm.

First of all, there is no obvious imbalance in the RMB exchange rate and there is no basis for unilateral depreciation. In the second half of 2011, the renminbi appeared the first stage depreciation since the 2005 reform. After that, the appreciation and depreciation of the stock market alternated at the same time. At the same time, the obvious two-way fluctuation characteristics showed that the adjustment of the RMB exchange rate was basically completed and the RMB exchange rate approached the equilibrium level.

Secondly, the central bank's withdrawal from the normalization of foreign exchange market intervention, economic fundamentals become the main factor in determining the exchange rate changes. The economic situation and even the political situation at home and abroad are constantly changing. There are both good and bad. All kinds of factors intertwine the supply and demand relationship of foreign exchange market. This determines that the exchange rate will rise and depreciate, and it can not be changed in one direction.

Thirdly, the improvement of exchange rate formation mechanism has laid the foundation for the market to play a decisive role in the formation of exchange rate. At present, the volatility of the RMB against the US dollar is 2% plus and minus, and the exchange rate for other currencies is larger than that of the other currencies, which is enough to accommodate the normal exchange rate fluctuations, and does not constitute a restriction on the market. The price determined by the market, including exchange rate movements, has always been two-way.

It should be noted that bilateral fluctuations do not fluctuate around a certain level, but are more likely to fluctuate around the trend line. Judging from the stage and fundamentals of China's economic development, although it is changing from high speed to high speed, it is still high speed from the international horizontal comparison, and the economic development level is moving towards the middle and high end. This is the basis for deciding the trend of RMB exchange rate for a long time in the future.

　　 Reporter: after the expansion of RMB two-way fluctuation, many enterprises suffered exchange losses. In the first half of this year, more than 70% of the listed companies suffered exchange gains and losses. According to statistics, the net loss of the 703 listed companies occurred at a total of about 11 billion 670 million yuan, while the net income of 1124 companies was only about 3 billion 900 million yuan. How should enterprises cope with the risk of exchange rate fluctuations in the future?

Ding Zhijie: in the past, the RMB exchange rate appreciated unilaterally, and the enterprises ignored the risk of holding foreign currency liabilities. The phasing devaluation made the exchange rate risk become a reality, resulting in a collective failure phenomenon of exchange losses larger than exchange earnings.

Enterprises should attach importance to and strengthen exchange rate risk management. We must recognize that two-way volatility has become a new normal of exchange rate. We can not have inertial thinking and regard exchange rate trend as immutable. We need to combine all kinds of domestic and international factors to judge the trend of exchange rate and adjust exchange rate risk management strategy in time.

The timely introduction and development of the RMB foreign exchange futures market is an important measure to effectively expand the risk management channels of enterprise exchange under the current foreign exchange management system. The government should cultivate and develop risk prevention tools. At present, there are not many risk aversion tools that enterprises can use. Some tools are not able to be used because of their high cost, and there is also a constraint on the principle of real demand, which makes it difficult to conduct effective exchange rate risk management. China's foreign exchange market still has great room for development, including improving foreign exchange market infrastructure, reducing the risk aversion costs of enterprises, and increasing the variety and currency of foreign exchange transactions.