On the first trading day after the National Day holiday, the RMB against the US dollar spot exchange rate expanded to more than 500 points as it approached the closing of the day.
On October 10, the spot exchange rate of RMB against the US dollar opened at 7.1135, with an afternoon decline widening, closing at 7.1440 at 16:30, down 509 basis points from the previous trading day.
RMB spot exchange rate against US dollar on October 10 (Source: China Currency Network)
While the RMB spot exchange rate against US dollar fell, the US dollar index rose straight, rising by more than 0.4% and rising above the 113 mark, reaching a high of 113.31.
Data from the China Foreign Exchange Trading Center showed that the RMB mid-price against the US dollar was 7.0992 on October 10, up 6 basis points.
"From today's mid-price performance, it still reflects the meaning of maintaining stability, but the performance of non-agricultural data in September slightly exceeded expectations, supporting the rise of the US dollar index." said a joint-stock bank forex trader .
"During this National Day, offshore RMB first depreciates against the US dollar and then rises, and the overall range fluctuations are maintained. In conjunction with countercyclical tools such as the increase in risk reserves of and official market communication, the upward rate of US dollar against RMB is expected to slow down after the holiday." Industrial Research predicts in its latest research report that it is expected that the judgment that the US dollar against the RMB has not yet peaked, and the market will start again, which may be 1-3 months after the long-term risk reserve ratio is implemented.
The institution also pointed out that the market has fully priced Fed at the end of 2 hike rate to 4.5%, and the US dollar index has weak upward in the short term. However, the fundamentals of the United States' better than those of non-US developed economies will continue to support the US dollar index to maintain a high level.
