Reporter of the Economic Business: Zhao Jingzhi Editor of the Economic Business Business: Liao Dan
26 During the trading session, the US dollar index fell, and non-US currencies generally rose.
Today, as the US dollar index further weakened in the afternoon, the RMB rose by more than 1,000 points against the US dollar. As of press time, the exchange rate of has recovered to within 7.20.
Offshore RMB rose by more than 1,000 points against the US dollar within the day. Image source: Wind
China Currency Network shows that the RMB against the US dollar mid-price was 7.1638, up 30 basis points from the previous day. As of press time, the onshore RMB exchange rate quotation against the US dollar rose to less than 7.18, up more than 1,300 points from the opening. But overall, the RMB exchange rate against the US dollar is still at a low level in the past decade.
html onshore RMB rose by more than 1,300 points against the US dollar within 0 days. Image source: WindJudging from the three major RMB exchange rate indexes, the data is basically the same as at the beginning of this year, which shows that RMB exchange rate remains basically stable at a reasonable equilibrium level.
"It should be pointed out that the current focus of stabilizing the exchange rate is not to maintain a fixed point, which leads to the RMB following up on the continued appreciation of the US dollar against other currencies, but to maintain the basic stability of the three major RMB exchange rate indexes and stabilize foreign exchange market expectations." Wang Qing, chief macro analyst of Oriental Jincheng , pointed out.
three major RMB exchange rate indexes remain the same as at the beginning of the year
From the overall perspective this year, the RMB and other non-US currencies are under depreciation pressure, such as the Japanese yen falling by more than 27% against the US dollar, the British pound falling by more than 14% against the US dollar, and the euro falling by nearly 12% against the US dollar this year. The depreciation pressure of currencies in various countries is mainly due to the impact of the strengthening of the external dollar.
yen, pound sterling and other currencies have depreciated relative to the US dollar this year. Image source: Wind
Judging from the three major RMB exchange rate indexes, the data is basically the same as at the beginning of this year, which shows that the RMB exchange rate remains basically stable at a reasonable equilibrium level. The RMB exchange rate index of a basket of currencies can better reflect the comprehensive competitiveness of a country's goods and services than the bilateral exchange rate of a single currencies, and can better reflect the changes in foreign exchange supply and demand caused by the real economy.
Specific data, at present, the CFETS RMB exchange rate index is 101.60, a decrease of 0.87 from the end of the previous year; the RMB exchange rate index (refer to the BIS currency basket) is 107.06, an increase of 0.4 from the end of the previous year; the RMB exchange rate index (refer to the SDR currency basket) is 98.36, a decrease of 1.98 from the end of the previous year.
However, since mid-last year, the US dollar has been in a super cycle, and the US dollar index has soared to a recent high of 114 from its low of 90 in May 2021.
US dollar index trend since May last year Picture source: Wind
The impact of the US dollar yesterday Central Bank and the State Administration of Foreign Exchange took action again, deciding to raise the macro-prudential adjustment parameters of cross-border financing of enterprises and financial institutions from 1 to 1.25.
"On the one hand, this move will help increase domestic US dollar liquidity, alleviate the pressure on RMB depreciation in the exchange rate market, and more importantly, it will further release the signal of stabilizing the exchange rate, help stabilize market confidence and avoid excessive gathering of expectations of RMB depreciation in the short term." Wang Qing said.
Yesterday, the Party Committee of the People's Bank of China and the Party Group of the State Administration of Foreign Exchange held an enlarged meeting and pointed out that we should deepen the market-oriented reform of exchange rates, enhance the flexibility of the RMB exchange rate, and maintain the basic stability of the RMB exchange rate at a reasonable equilibrium level.
and the RMB exchange rate also has a solid foundation for maintaining basic stability. In the article "Deeply Promoting Exchange Rate Marketization Reform", the central bank stated that my country's economy has continued to recover and develop in the near future, maintaining basic stability of prices against the backdrop of global high inflation, and the trade surplus has continued to remain high. The trade difference between in the first eight months of this year was 356.05 billion US dollars, and increased by 357% year-on-year. With the emergence of the macro-policy effect, the basic economic market will be more solid, which is the largest basic market for the stable exchange rate.
exchange rate policy tools are sufficient
It is reported that since the beginning of this year, the central bank has taken various measures to regulate the exchange rate, mainly: lowering the foreign exchange deposit reserve ratio, raising the foreign exchange risk reserve ratio, and raising the macro-prudential adjustment parameters of cross-border financing.
As on September 5, the central bank issued a message that in order to improve the ability of financial institutions to use foreign exchange funds, it was decided to lower the foreign exchange reserve ratio of financial institutions by 2 percentage points from September 15, 2022, that is, the foreign exchange reserve ratio is lowered from the current 8% to 6%.
htmlOn September 26, the central bank issued an announcement stating that in order to stabilize foreign exchange market expectations and strengthen macro-prudential management of , it decided to raise the foreign exchange risk reserve ratio of forward foreign exchange sales business from 0 to 20% from September 28, 2022.On October 25, the central bank announced that it had decided to raise the macro-prudential adjustment parameters of cross-border financing of enterprises and financial institutions from 1 to 1.25.
Wang Qing had previously told reporters that if the RMB exchange rate deviates from the trend of the US dollar index, the central bank can not only lower the foreign exchange reserve ratio, but also announce the restart of the countercyclical factor in a timely manner, raise the foreign exchange risk reserve ratio, increase the issuance scale of central bills in the offshore market, and strengthen cross-border capital liquidity management and other measures. In addition to the above specific policies and measures, the regulatory authorities can further strengthen market communication, guide market expectations, and prevent the pro-cyclical behavior of the foreign exchange market from triggering the "herd effect".
Daily Economic News
