has depreciated significantly in the exchange rate of the RMB to the US dollar since this year. On May 27, the exchange rates on the shore and offshore were depreciated to 7.18 and 7.2, respectively, which were close to the period of the RMB exchange rate in early September 19th. In early 2008. How does
explain the depreciation of the RMB exchange rate since this year?
1. is not because of economic changes.
First, it is difficult to explain the depreciation of the RMB exchange rate from an economic perspective.
was affected by the new crown pneumonia epidemic, and the global economy was greatly impacted. But exchange rate is a relative indicator. Compared with the United States, we must be better than the United States in terms of control of the epidemic or economic recovery. From the perspective of the epidemic, as of May 30,
has a total of 83,000 infected with new crown pneumonia, which is far lower than 1.8 million in the United States. As early as in early March, my country reduced the number of new infections to below the double digits per day, and the number of new infections per day in the United States until late May still exceeds 20,000. From the perspective of economic recovery,
has returned to the PMI index of manufacturing in March to 50 % of the Rongku balance line. The speed will be from negative to 3 %. The PMI index of the United States in April and 5th month is less than 40 %. The Fed in New York is expected to decrease significantly by 35.5 % from the previous quarter. In fact,
is not surprised that the changes in the exchange rate cannot be explained by economic growth, because in the past, it had been separated from the exchange rate trend for a long time.
, for example, from 2007 to 13, China's GDP growth rate fell from 14.2 % to 7.8 %, and the growth rate of US GDP growth from 1.9 % to 1.8 % during the same period, the gap between the growth rate of GDP in China and the United States continued to narrow sharply, but during the same period The exchange rate rose sharply from 7.3 to 6.05.
is not only in China. After the Japanese bubble economy was shattered in 1989, its economy stagnated for a long time, far less than the US economy in the same period. However Essence Theoretically,
is theoretically determined by the fund supply and demand of the foreign exchange market, and the funds supply and demand is not necessarily related to the economic growth of various countries. Therefore, it is normal for the exchange rate to perform inconsistent with economic growth.
2. is not due to interest rate changes.
is second. It is difficult to explain the depreciation of the RMB exchange rate on the US dollar this year from the perspective of interest rates. In the theory of foreign exchange decisions in
, an important theory is the theory of interest rate parity. It is believed that there is a close relationship between exchange rates and interest rates, because interest rates can affect the supply and demand of funds in the foreign exchange market, and then affect the exchange rate.
is observed from Chinese data. In the past, the changes in the spread of Sino -US spreads can well explain the changes in the exchange rate of the RMB to the US dollar.
We represented Sino-US interest spreads with the difference between US debt interest rates in 1 year. From 2006 to 13, Sino-US interest spreads continued to rise from -2.9 % to 4.1 %. In the same period, the RMB exchange rate from the US dollar rose from 7.81 to 6.05. After 13 years, Sino -US spreads have narrowed, and the exchange rate of the RMB to the US dollar has also re -depreciated from the highest level of 6.05. The changes in
China and the United States reflect the different monetary policy cycles of China and the United States. Due to the outbreak of the subprime mortgage crisis, the United States entered the interest rate reduction cycle in 2006 and 2007, and the economy and interest rates of China resumed rapidly after 2008. Since then appreciation.
was in 2013. After China experienced money shortage, the interest rate also continued to decline. The United States reappeared the interest rate hike cycle in 15 years. The Sino The maximum narrowing to about 0, and the exchange rate of the RMB against the US dollar also degraded from 6.05 to 6.87.
But since 2019, the United States has once again entered the interest rate cut cycle, and even restarted zero interest rates in 2020. Although China also followed the US interest rates at the United States, the interest rate cut was later than the United States, and the interest rate cut was far less than the United States. The spread between China and the United States in 2019 expanded from 0 to 0.77 %, and since 2020, it has further expanded to 1.43 % at the end of May, but in 2019 and 2020, the exchange rates of the US dollar to the US dollar have been depreciated to 6.97 and 7.13, respectively.
is why, although the change in interest rates can explain the trend of the RMB to the US dollar from 2006 to 18, it still cannot explain why the spread between the United States and the United States has continued to expand in the past two years, but the RMB has depreciated against the US dollar.
3. may be found that the depreciation of the RMB exchange rate on the US dollar this year is related to the concerns of capital outflow this year. According to international revenue and expenditure theory,
determines the short -term exchange rate level and its changes in the international revenue and expenditure theory. From the perspective of Chinese historical data, there is a high positive correlation between my country's foreign exchange rate and foreign exchange reserves.
rose from the highest foreign exchange reserves from US $ 620 billion to US $ 3993 billion from early 2005 to June 14th. The rise in foreign exchange reserves means an increase in the demand for the RMB in the foreign exchange market. The highest rose to 6.05 early 14 years. Starting from June 14 years, my country's foreign exchange reserves have fallen, which means that the demand for RMB in the foreign exchange market has declined, and the exchange rate of the RMB to the US dollar has also declined all the way. The decline in the
foreign exchange reserve can also be partly explained to the depreciation of the RMB exchange rate this year. Affected by the epidemic, as of April this year, my country's foreign exchange reserves were US $ 3091.4 billion, a decrease of US $ 16.5 billion over the end of last year. Among them, March's foreign exchange reserves fell by 36.1 billion US dollars from the previous month.
According to the foreign exchange revenue balance balance table of the Foreign Management Bureau, my country's foreign exchange reserves in the first quarter of this year decreased by $ 25.1 billion. The main reason was that the deficit of US $ 29.7 billion has occurred. The US dollar decreased sharply; the service trade deficit was 47 billion US dollars, which was slightly narrowed from the US $ 63.4 billion in the same period last year. Therefore, the depreciation of the RMB exchange rate in the first quarter or the decline in foreign trade surplus has declined significantly, which is directly related to the outbreak of the new crown epidemic.
, but the impact of the epidemic on China's foreign trade is actually short -term. After entering April, with the significant alleviation of the domestic epidemic, the surplus foreign trade surplus in April has risen to $ 45.3 billion, far exceeding the total of $ 12.5 billion in the first quarter. Since May, the European and American epidemic has gradually eased and resumed work has begun, which means that China's external demand in the second half of the year is expected to gradually return to normal.
and in May, the RMB exchange rate on the US dollar has depreciated again, or it is related to the recent threat of the United States' recent suspension of exporting goods to the United States to the United States. The market is worried that it will indirectly affect China's exports and even capital flows.
In fact, although we have a large number of trade transitions through Hong Kong in Hong Kong, the import and export of the re -export trade itself are taxed in accordance with the "origin principle". Therefore Hong Kong's local import and export to the United States. However, according to the statistics of the Hong Kong Industry and Trade Agency, Hong Kong, China exported to the United States 3.642 billion Hong Kong dollars in 2018, and imports from US $ 105.346 billion from the United States, and the local trade deficit with the United States in Hong Kong, China, was HK $ 101.7 billion. This means that it is more affected by the United States itself, which will reduce its trade surplus to Hong Kong, China.
China Daily quoted MSNBC reports that Trump announced on May 29 that it would cancel a special policy treatment for Hong Kong, China, but after the news was announced, the RMB will not rise against the US dollar, especially offshore RMB The exchange rate of the US dollar has risen sharply from a low level of 7.17 to 7.13, indicating that the market has also realized that the actual impact of the US policy is very limited.
4. Global Insurance Aversion
Another important factor that affects the exchange rate of the RMB this year is the appreciation of the US dollar. As of the end of May,
appreciated 1.9 % compared with the end of last year, which means that currencies in major developed countries have almost depreciated the US dollar. Since the beginning of this year, except for the appreciation of the yen to the US dollar by 0.8 %, the pounds, Canadian dollars, Australian dollars, and euros have depreciated 6.8 %, 6.1 %, 5 %, and 1 % respectively.
and emerging market currencies have a larger depreciation of the US dollar. As of May 29, the currency index of Mingsheng emerging market depreciation was 5.6 % compared with the end of last year. We have counted the average depreciation of 22 major emerging market currencies to the US dollar.Among the
, Brazil is the most depreciated, 26 %, and the depreciation of currencies in Colombia, Argentina, Turkey, Russia, Mexico, South Africa and other countries also exceed 10 %.
is therefore depreciated by the depreciation of global currencies to the US dollar, the depreciation of the RMB to the US dollar is not great. Among the 22 emerging markets that we have, the depreciation of the RMB against the US dollar this year ranks fifth, far lower than the average depreciation of the currency of emerging markets, and it is also better than developed countries such as British pounds, Canadian dollars, and Australian dollars.
According to the CFETS RMB exchange rate index published by the China Foreign Exchange Trading Center, after weighted the proportion of trade, the RMB has appreciated by 2 % for the 13 % of the major international currencies this year, which also proves that the main reason for the depreciation of the RMB to the US dollar is the appreciation of the dollar.
and the appreciation of the US dollar mainly originated from the impact of the epidemic, which brings the heating of global risk aversion, and the US dollar benefits as a global reserve currency. For example, during the 2008 financial crisis, we also observed the short -term appreciation of the US dollar.
but the risk aversion itself is short -term, and the market will eventually return to the value of each currency itself. The US dollar is not wrong with the global reserve currency, but since March, the United States has launched unlimited quantitative easing monetary policy, and has printed a large number of banknotes through fiscal deficit monetization, which has severely overtake the US currency. As of May 18,
, the year -on -year growth rate of the Broadcasting Monetary M2 has risen to 23 %, a new high since 1944. At the same time, IMF predicts that the US economic growth will shrink by 5.9 % this year. The growth rate of currency far exceeds the economic growth rate, which means that the US dollar is serious, and the US dollar itself has also depreciated sharply.
has announced the super loose monetary policy since the United States announced, the US dollar index has re -devouted from the highest 103 on March 19 to 98.26 at the end of May. Therefore, if the appreciation of the US dollar is not sustainable, the RMB will not continue to weaken against the US dollar.
5. is concerned about currency to internal depreciation
. We believe that it is not the currency depreciation of the currency, but the inside depreciation of the currency. The
epidemic also caused great harm to the Chinese economy. In the first quarter, China's GDP growth rate fell by 6.8 % year -on -year, a record low. We expect that the economic growth rate after the second quarter is expected to gradually recover. The annual GDP growth rate will rise to about 3 %, but it is still significantly lower than the 6.1 % GDP growth rate last year. In order to hedge the impact of
, we implemented positive fiscal policies this year. Among them, the budget broader fiscal deficit reached 8.5 trillion, an increase of 3.6 trillion from last year. Essence
is not only active in financing this year. From the perspective of social finance data, in the case of government bonds, the total social financing in the first 4 months has increased by 4 trillion year -on -year. 500 billion yuan, while corporate loans and corporate bonds increased by 3.5 trillion year -on -year. This shows that the corporate department is also vigorously financing, especially the state -owned enterprises and government financing platforms with hidden credit endorsements of the government. In terms of monetary policy,
In order to cooperate with the amount of days of financing, the government work report said that this year's stable monetary policy must be more flexible and moderate. Higher than last year. As of April this this April and this April of this this,
has risen to 11.1 %, a new high since February 17. With the large -scale issuance of government bonds, it is expected that the central bank will continue to surrender to support commercial banks to purchase bonds and issue credit. The broader currency growth rate is expected to further rise. It is expected that the growth rate of M2 will rise to more than 13 % throughout the year.
is weak due to the sharp increase in currency growth, and the recovery of economic growth is weak. It is expected that the gap between currency growth and economic growth will be as high as 10 %, which is significantly increased from 2.6 % last year. In the past 20 years, this gap is second only to 2009.
If the ratio of broad currency to GDP is regarded as an approximate indicator of macro debt rates, it is expected that this ratio will rise to 215 % in 2020. After three consecutive years of decline Creating a record high.
is actually a global phenomenon. For example, this year's broad currency growth rate or higher GDP growth rate is about 30 %. The broad currency growth rate of the euro zone will also be more than 10 % higher than the GDP growth rate. Far more than China.
We know that the epidemic has led to global suspension and production, and the global economy has suffered huge losses. The question is, who will bear this loss? One way is to levy taxes to the rich, and the other is to reduce the government's expenditure and let the poor bear losses, but there are huge resistance in these two methods, which is not feasible in reality. The only feasible way of
is actually the currency of the fiscal deficit in Europe and the United States, that is, the financial bonds, and then buying debts through the central bank's banknote printing, and using the money to help residents and enterprises affected by the epidemic. This method looks happy, but the problem is that money cannot fall from the sky. A large amount of money that is excessive is actually equivalent to all the people who hold the money to share the loss of the epidemic together, making the money worthless It's right.
Therefore, if the trend of currency over increase in the future is inevitable, in fact, it does not need to worry too much about the exchange rate of the RMB to the US dollar, because our currency exchanges are far better than the United States in this round. However, changes in currency to internal value need to be paid high, and assets that need to configure anti -inflation to prevent currency from depreciating.
This article comes from the financial industry website
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