RMB Two-Way Volatility Is Likely To Intensify

The spot exchange rate of RMB against the US dollar rebounded in the near future after five straight days of decline. In April 15th, the spot exchange rate of RMB against the US dollar closed at 6.2052, up 0.11% from the previous trading day, the largest gain in 7 years. On the same day, the central parity of the RMB against the US dollar was 6.1340, which was 67 basis points higher than the central parity of the previous trading day. It also ended three consecutive days of decline. The RMB exchange rate in the interbank foreign exchange market in April 16th was 1 yuan to 6.1305 yuan.

　　 Wide fluctuation of exchange rate

Reporters learned from market participants, experts and so on. Spot price The double price drop of central parity is influenced by factors such as the hot stock market, but considering that the RMB is negotiating with the basket of currencies for special drawing rights, the two-way fluctuation of the renminbi may be aggravated, but the depreciation space is not big enough to continue the wide fluctuation pattern.

China's double negative growth in imports and exports in March shows that domestic demand and external demand are insufficient for the current economic growth, and the downward pressure on the economy remains great.

Zong Liang, deputy director of the International Finance Research Institute of the Bank of China, said that in the future, the RMB exchange rate is necessary to depreciate slightly against the US dollar on the basis of the basic stability of the package currency. This will help to stabilize China's foreign trade, and the exchange rate will fluctuate within a certain range.

As the US economy continues to recover and the Fed raises interest rates strongly, the dollar index has recently shot to nearly 100 highs. Foreign exchange traders told reporters that the recent strength of the US dollar forced RMB to bear pressure.

RMB versus US dollar exchange rate For a long time, the traders believed that from the present point of view, the balance of foreign exchange settlement was relatively balanced. It was initially estimated that the future devaluation of the RMB would be a small probability event. "Considering the factors such as China's economic fundamentals, capital flows, RMB internationalization and RMB's accession to the SDR, it is expected that the RMB exchange rate will stabilize in the year".

Other market participants believe that the recent surge in Hong Kong stocks and B shares has stimulated investors' demand for foreign exchange and triggered a sell-off in the renminbi. In the A share wealth spillover effect, Hong Kong stock market has been booming since last weekend, and some investors are buying Hong Kong dollars in Renminbi to further pressure the RMB exchange rate.

　　 Compliance with market supply and demand will not be deliberate. depreciation

Goldman Sachs research report believes that because the government strongly hopes to boost exports, the RMB may depreciate again after a brief rebound since mid March. This statement has been denied by the government. Recently, Premier Li Keqiang clarified the attitude of the Chinese government that China would not join the "currency war" or deliberately devalue the renminbi. China has been pushing ahead with the reform of the RMB exchange rate formation mechanism, expanding the two-way floating zone and improving the managed exchange rate system based on market supply and demand.

Premier Li Keqiang stressed: "the renminbi is basically at a basically stable level. I do not want to see the RMB continue to depreciate, because we can not stimulate exports by devaluation, and do not pay attention to expanding domestic demand. China's economic structure is hard to adjust. Enterprises should not rely solely on or rely mainly on the depreciation of the renminbi to increase export volume. Instead, they should practise Chr (34) Chr (34), make their products technological innovation and quality improve greatly. In addition, we hope that the major economies will strengthen macroeconomic policy coordination. We do not want to see the state of currency devaluation, which will lead to currency wars and forced devaluation of the RMB. I think this is not a good result for the world financial system. Finally, it may lead to protectionism and impede the process of globalization, which we do not want to see. "

At present, many economists predict the exchange rate of RMB against the US dollar at the end of the year 1 yuan to 6.2 yuan to 6.35 yuan.

Since the end of March, the exchange rate of RMB against the US dollar has been generally stable. The middle price fluctuated between 1 US dollars and 6.13 yuan to 6.15 yuan. The spot price fluctuated from 6.19 to 6.22 yuan. Analysts pointed out that, after the Yuan's derogation and rise and overall stability last year, the expectation of RMB on the market has gradually become balanced. No long-term unilateral appreciation or unilateral depreciation has become the consensus of the market. In the short and medium term, despite the strong US dollar and the domestic economic downturn, the RMB is still under pressure, but considering the attractive interest of domestic and international spreads and the demand for RMB internationalization, the RMB exchange rate will remain wide.