was talking to friends about the short-term rapid depreciation of the RMB during the trading session yesterday. It was a bit too exaggerated. It fell from 7.1795 to 7.2675 in one breath, which means that the depreciation in one day was close to thousands of basis points. Moreover, judging from the trend of the US dollar to offshore RMB , there was a very obvious acceleration downward effect. Usually, when it had fallen for a period of time before and a sharp drop exceeds expectations in a single day, it was generally the last release of emotions.
even during the session, a friend asked whether the RMB will move towards 8 in the short term. Although no possibility cannot be ruled out, I thought , the central bank had a bottom limit of the central bank. I guess in the face of the irrational depreciation of the RMB in the short term, the central bank would not sit idly by. As a result, when the speech fell into the afternoon, the central bank indeed shouted.
said that a national foreign exchange market self-discipline mechanism video conference was held on September 27, analyzing the current operation of the foreign exchange market and deploying the work of strengthening self-discipline management. When evaluating the trend of the RMB, it said that the depreciation was only half of the appreciation of the US dollar during the same period, but it was in a significant appreciation for the euro, pound and yen. The RMB is now a relatively few strong currencies in the world.
The key point is that the current foreign exchange market is generally stable, but there are a few companies following the trend of "exchange speculation" and financial institutions' illegal operations. We should strengthen guidance and correction. In fact, this sentence is very obvious. It is mainly due to a few companies speculating in foreign exchange, and financial institutions have illegal operations. This means that the central bank has found the reason for the rapid depreciation of the RMB. Since it can find the problem, it has the ability to solve the excessive speculation of the exchange rate , so that the RMB will end the excessive depreciation in the short term.
In the end, the RMB rose by thousands of points during the session. Although the decline in the first half of yesterday was very tragic, the subsequent rise was also very satisfying. In many people's impression, the Central Mom is still a central Mom. As expected, it seems that the shouting really works.
The real reason for the rapid appreciation of the RMB
From the surface, the central government's shouting played a role, but you have to think carefully, the problem is not what you imagined, because when most media release this news, the time was about 18 o'clock in the evening, and the offshore RMB only had a brief rapid appreciation at that time. This range is almost negligible compared with the depreciation of the day. What is more strange is that the real appreciation occurred after 21:30 pm. The trend of the offshore RMB in time sharing began to be continuous, and it was formed in this way from 7.23 to 7.14 in one breath.
If you observe carefully, you will find that the same time point is exactly the time when the dollar index dives, that is, the diving time of the dollar index and the appreciation of the RMB occur simultaneously. In this way, you can draw a conclusion that the rapid appreciation of the people in the short term is due to the central government’s voice and the decline of the dollar index. To a greater extent, I think the decline of the dollar index occupies the dominant factor.
So from this conclusion, it can be expected that in the future, the RMB will change its depreciation trend. On the one hand, it depends on the central bank's efforts to curb speculation, and on the other hand, it depends on whether the US dollar index will peak and fall in a trend. This will have a positive effect on the RMB's steady progress. Besides, this wave of rapid depreciation of the RMB is also caused by the continued high of the US dollar index. This is the person who tied the bell.
RMB appreciation is of course a good thing for A shares . The A-share trend has been bad recently. The important reason is that the RMB has been falling. As long as this phenomenon changes, I think the probability of A-shares bottoming out is very high. Today, the market opens higher. In the current situation of digging holes and the relatively high probability of the exchange rate market fluctuation, holds is the only choice.
Disclaimer: The content in the article is for reference only and does not constitute any operational suggestions or prompts. Please be cautious when there are risks in the stock market and investment!
