China News Agency, Beijing, November 14 (Reporter Xia Bin) The RMB continued to rise strongly against the US dollar.
On the 14th, data released by the China Foreign Exchange Trading Center showed that the central parity rate of the RMB against the US dollar was 7.0899, an increase of 1,008 basis points from the previous trading day, the largest increase since July 22, 2005.
In the foreign exchange market, the spot exchange rates of the onshore and offshore RMB against the US dollar have strengthened since last Thursday (November 10). Compared with the opening data on the 10th, the spot exchange rates of the onshore and offshore RMB against the US dollar were both on the morning of the 14th. It has risen by more than 2,000 basis points, and the offshore RMB exchange rate touched 7.0163 in the afternoon, approaching the 6 range.
What are the forces driving the rise of the renminbi?
From an external point of view, the adjustment of the U.S. dollar index has eased the pressure on RMB depreciation.
Since the beginning of this year, with the tightening of the Fed's monetary policy and the continuous increase in interest rates to push up the US dollar index, most of the global non-US currencies have weakened.
After the latest CPI (Consumer Price Index) data in the United States showed that inflation fell, the market's expectations for the Fed to slow down interest rate hikes rose, and the dollar index showed a significant correction.
According to the Chicago Mercantile Exchange, the probability of the Fed raising interest rates by 50 basis points in December is 80.6%, and the probability of raising interest rates by 75 basis points is reduced to 19.4%.
Zhou Maohua, a macro researcher at the Financial Markets Department of China Everbright Bank, said that the US dollar has been unsuccessful in recent days and remains high and volatile, and the market remains vigilant about the prospect of a US economic recession.
With the intervention of the Japanese yen and aggressive interest rate hikes by the European Central Bank to catch up, the basis for the further sharp rise of the US dollar has been significantly weakened, which has created conditions for the basic stability of the RMB exchange rate.
The research report of CITIC Securities stated that, except for the growth rate of the US CPI and core CPI, which did not exceed expectations and the previous value, the growth rate of the main sub-items in the US CPI in October slowed down significantly compared with September, indicating that US inflation The current inflection point may have already occurred.
Under the circumstance that the inflation turning point has already appeared, combined with the interest rate meeting in November and the recent statements by many Fed officials to slow down the pace of interest rate hikes, it is expected that the Fed will raise interest rates or enter the second stage, and the probability of raising interest rates by 50 basis points in December is relatively high. big.
The research report believes that as the U.S. inflation inflection point has been reached and the Federal Reserve has entered the second phase of interest rate hikes, the U.S. dollar index will also appear at an inflection point, and it is expected that the U.S. dollar index may find it difficult to reach new highs.
Under this influence, it is expected that the external pressure on the RMB exchange rate will be weakened, and the exchange rate trend will depend more on the repair of the domestic economic fundamentals.
Internally, multiple positive factors have combined to push the renminbi to strengthen.
Economic fundamentals are an important factor in determining the exchange rate. Currently, China's economy is expected to be improving.
Sheng Songcheng, a professor at China Europe International Business School and former director of the Survey and Statistics Department of the People's Bank of China, said that on the whole, China's economy has stabilized and started to rise.
It is manifested in many aspects.
First, the effect of the implementation of macro policies has become increasingly apparent, and infrastructure investment has accelerated to form a physical workload, which has become an important support for investment growth and a catalyst for economic recovery.
Second, the foundation for economic stabilization and improvement has been continuously consolidated, industrial production has improved, and investment in the manufacturing industry has maintained a relatively high growth rate. The advantages of China's industrial chain and supply chain continue to be attractive in the complex international environment, and foreign trade remains resilient.
Third, market expectations have begun to improve, which is reflected in many aspects.
For example, the real estate financing environment tends to improve, the market is gradually bottoming out, financial support for the real economy is intensified, and the reform of “delegating power, regulating services,” continues to advance.
The expected improvement of enterprises will promote investment and employment, and the expected improvement of residents' income and employment will be conducive to consumption growth.
Chinese officials will not allow continued unilateral depreciation of the RMB exchange rate.
Wang Youxin, a senior researcher at the Bank of China Research Institute, said that the inherent genes and fundamental factors that support the stability of the RMB exchange rate continue to play a role. boosted market confidence.
Analysts in the foreign exchange field of CICC said that from past experience, the RMB exchange rate has the characteristics of seasonal strengthening at the end of the year.
At the end of the year, the demand for foreign exchange settlement, such as the return of the exporter's payment, may be an important reason for the seasonal strengthening of the RMB.
At present, the potential return of cross-border securities investment brought about by the optimization of epidemic prevention and control work may become a force supporting the RMB exchange rate together with seasonal foreign exchange settlement.
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