China News Service, May 27. According to the website of the central bank, on May 27, 2021, the seventh working conference of the national foreign exchange market self-discipline mechanism will be held in Beijing.

The meeting mentioned that companies should focus on their main business, establish a "risk-neutral" concept, avoid deviating from risk-neutral "foreign exchange" behavior, and do not bet on the appreciation or devaluation of the RMB exchange rate.

  Representatives of 30 member institutions of the national foreign exchange market self-regulatory mechanism participated in the meeting. The meeting elected Liu Jin, President of the Bank of China, as the new chairman of the national foreign exchange market self-regulatory mechanism, and reviewed and approved the national foreign exchange market self-regulatory mechanism member level adjustment plan and self-regulation revision Matters.

The member institutions of the foreign exchange self-discipline mechanism exchanged special topics on risk-neutral work.

Liu Guoqiang, chairman of the China Foreign Exchange Market Steering Committee (CFXC) and deputy governor of the People’s Bank of China, attended and delivered a speech. Wang Chunying, deputy chairman and deputy director of the State Administration of Foreign Exchange, and members of the foreign exchange self-discipline mechanism and foreign exchange market steering committee attended the meeting.

  The meeting concluded that the current foreign exchange market is generally balanced.

In the future, there are many market and policy factors that affect the exchange rate. The RMB may appreciate or depreciate.

No one can accurately predict exchange rate movements.

Whether it is short-term or medium- to long-term, the uncertainty of exchange rates is inevitable, and two-way fluctuations are the norm. Governments, institutions or individuals must avoid being misled by predictions and conclusions.

A managed floating exchange rate system based on market supply and demand, adjusted with reference to a basket of currencies, is suitable for China's national conditions and should be adhered to for a long time.

Under this exchange rate system, the exchange rate cannot be used as a tool, nor can it be used to depreciate to stimulate exports, nor can it be used to appreciate to offset the impact of rising commodity prices.

The key is to manage expectations and resolutely crack down on all kinds of malicious manipulation of the market and malicious creation of unilateral expectations.

  The meeting emphasized that both enterprises and financial institutions should actively adapt to the two-way fluctuation of exchange rates.

Enterprises should focus on their main business, establish a "risk-neutral" concept, avoid deviating from risk-neutral "foreign exchange" behavior, and do not bet on the appreciation or devaluation of the RMB exchange rate.

Not only can financial institutions not help companies "speculate foreign exchange", they should not "speculate foreign exchange" themselves. Otherwise, it is not conducive to the steady operation of banks and will cause exchange rate fluctuations.

The foreign exchange self-discipline mechanism must be unremitting, continue to guide enterprises and financial institutions to establish a "risk-neutral" concept, system escort, focus on practical results, implement "I do practical things for the people", and promote the healthy development of the real economy.

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