The central parity rate of the renminbi has been raised by more than a thousand points in 2021 or stronger next year

　　China-Singapore Jingwei reported on December 31 that the China Foreign Exchange Trading Center reported that the central parity of the RMB against the US dollar was reported at 6.3757 on the 31st, a depreciation of 83 basis points.

Wind data shows that the cumulative increase for the whole year was 1492 basis points.

　　　Source: China Foreign Exchange Trade Center

　　The People's Bank of China work conference will be held in 2022. The meeting requires that a prudent monetary policy be flexible and appropriate.

Comprehensively use a variety of monetary policy tools to maintain reasonable and sufficient liquidity;

　　Looking forward to next year, Xie Yaxuan, managing director of China Merchants Securities R&D Center, believes that the RMB exchange rate in 2022 will be stronger than in 2021.

The current strength of the renminbi will continue into January next year, but considering seasonal factors, the renminbi may be slightly weaker in the late first quarter or even the second quarter of next year, and the renminbi will strengthen again by the end of next year.

　　Regarding the possible pressure of RMB appreciation in 2022, Xie Yaxuan believes that to further enhance the flexibility of the RMB exchange rate and tolerate exchange rate fluctuations, the only way to increase the flexibility of the RMB exchange rate is to implement a more flexible and floating exchange rate to reduce and avoid exchange rate distortions. The impact of the appreciation of the RMB exchange rate on the economy and enterprises should be viewed dialectically.

　　Industrial Securities believes that in January 2022, the RMB exchange rate will remain strong. On the one hand, it will be affected by the pre-holiday foreign exchange settlement of enterprises, and on the other hand, there may be a wave of foreign capital inflows at the beginning of the year.

However, given that the central bank's tolerance for further appreciation of the renminbi is getting lower, it is expected that USDCNY will still operate above 6.30.

　　In addition, the renminbi exchange rate has a "cross-year effect", that is, due to tight funds and rigid exchange settlements, the renminbi exchange rate tends to move strongly in December and January of the following year.

Industrial Securities pointed out that since the two-way volatility in 2014, the fluctuation range of the RMB against the U.S. dollar in January has ranged from a depreciation of 1.3% to an appreciation of 3.4%. After 2017, the probability that the RMB will appreciate against the U.S. dollar in January is 100%.

The exchange rate of USD to RMB in January 2022 is expected to operate in the range of 6.30-6.40.

(Zhongxin Jingwei APP)

(The opinions in the article are for reference only and do not constitute investment advice. Investment is risky, and you need to be cautious when entering the market.)