USD index rose 16.6% in 2022, and Fed has also started the fastest rate hike in history. From the first rate hike in March 2022, to September, Fed hike raised five times, and the federal benchmark interest rate reached the range of 3% to 3.25%. The five times were 25 basis points, 50 basis points, 75 basis points, 75 basis points, and 75 basis points respectively. raised a total of 300 basis points; Federal Reserve Chairman Powell hinted that a rate hike of 100-125 basis points will be raised in 2022.
With the Fed's sharp interest rate hike, many countries such as EU , the United Kingdom, Canada, South Korea, India have started the process of hike rate hike; interest rate is the best monetary policy used by central bank to regulate the economy, reducing the economic heat through hike rate hikes and alleviating the degree of inflation .
When the US economy is severely inflationary and crazy interest rate hikes, another situation occurs in China, cutting interest rates; on September 15, 2022, Bank of China , China Construction Bank , Industrial and Commercial Bank of China , Agricultural Bank of China all issued announcements to adjust the interest rate of RMB deposit listing; data shows that the 3-month, 6-month, 1-year, 2-year, and 5-year fixed deposit interest rates all fell by 10 basis points; the 3-year fixed deposit interest rate was lowered by 15 basis points. What is the reason why the RMB not only did not follow the Fed's interest rate hike, but could it also decline?
First of all, interest rate hikes and interest rate cuts are for the healthy development of the country's economy. This is the case with the Federal Reserve's crazy interest rate hikes, and the same is true for China's non-rate rate hikes.
The United States' CPI in June 2022 was 9.1% (the highest in 40 years), the CPI in July was 8.5%, and the CPI in August was 8.3%; China's CPI in June 2022 was 2.5%, the CPI in July was 2.7%, and the CPI in August was 2.5%.
CPI refers to consumer price index . In economics, it is a price change indicator that reflects the price of products and services related to residents' lives; it is one of the main indicators for measuring inflation. generally defines that more than 3% is inflation, and more than 5% is serious inflation.
From the CPI data of China and the United States, it can be seen that the United States has experienced very serious inflation, while China has not experienced inflation. The EU (CPI in August was 8.9%), the United Kingdom (CPI in August was 9.9%), South Korea (CPI in August was 5.7%), Canada (CPI in August was 7%), India (CPI in August was 7%), and India (CPI in August was 7%), have severe inflation in China and have to raise interest rates.
China has no inflation, which is mainly due to the fact that the epidemic situation in China is very well controlled and the central bank has not released a large amount of money. China's economic development corresponds to the above countries, so naturally there is no need to follow the interest rate hike.
Secondly, the economic structures of China and the United States are different. The total amount of GDP in the United States in 2021 is US$22.92 trillion; the primary industry (agriculture) accounts for less than 1%; the US secondary industry (industry) accounts for about 18% of GDP; tertiary industry (service industry) accounts for more than 80% of the US GDP, reaching US$18.5 trillion; Among them, the financial services industry accounts for 21.5% of the US GDP.
China's total GDP in 2021 is 114.3 trillion people; The primary industry accounts for 7.3% of GDP, the secondary industry accounts for 39.4% of GDP, and the tertiary industry accounts for 53.3% of GDP.
From the data, we can see that the US financial and service industries are also very developed, and are the big part of the US economy; China is the world's factory, and the secondary industry accounts for a larger proportion than the United States. China has established the world's most complete industrial system and is the world's largest manufacturing power.
US industry is mainly high-tech industries, with very few basic industries, mainly relying on imports. At this time, the appreciation of the US dollar is also beneficial to the purchasing power of the US dollar. This is one of the driving forces for the appreciation of the US dollar and is in line with the interests of the US economy.
China is the world's factory. In the case of a sharp depreciation of major currencies around the world against the US dollar, if the RMB is depreciated improperly, it is not conducive to the competitiveness of Chinese products in the global market. The appropriate depreciation of is also conducive to exports. Therefore, the appropriate depreciation of the RMB is also in line with China's economic interests.
Although China depreciates by 10.8% against the US dollar in 2022, if we look at the data from 2019, the RMB is still firm against the US dollar. The lowest price of 1 US dollar against the RMB in 2019 was 7.18, and it was 7.09 in September 2022. The RMB3 actually appreciates against the US dollar.
The RMB appreciated 10.3% against the euro in 2021, and 3.8% against the euro in 2022; the RMB appreciated 14.5% against the Japanese yen in 2021, and 13% against the Japanese yen in 2022; the RMB appreciated 3.68% against the pound in 2021, and 7.9% against the pound in 2022.
From the above numbers, we can clearly see that from the general trend, the RMB is the strongest currency among the major economies; this is the main reason why China's economy has developed much better than Europe, America and Japan; especially the epidemic is well controlled, and the economy's share in the world has grown steadily, which is also the fundamental reason for the strong RMB.
USD raising interest rates is a blazing fire. It is a forced one. If domestic hyperinflation is not controlled, the consequences of allowing inflation to rise are very terrible. American society is in turmoil and the economy is in a serious crisis; at the same time, the US dollar will turn into waste paper and the United States loses its monetary hegemony status. Therefore, the Federal Reserve must raise interest rates. It is more beneficial to the United States by passing the crisis to other countries. Of course, the harm to itself is also obvious. The United States itself may also have a hard economic landing.
Under such circumstances, the Federal Reserve's interest rate hike has little impact on China, China has no inflation, and economic growth needs stimulus. At this time, appropriate reserve requirement ratio cuts and interest rate cuts are China's policy advantages; is more calm than the United States in terms of policy adjustments, so the United States raises interest rates, and China not only does not follow, but also has room for interest rate cuts.
2. US dollar index, Dow Jones index , Nasdaq index trend analysis
US dollar index continued to rise under the stimulus of the Federal Reserve's interest rate hike again, breaking through 111.5; Federal Reserve Chairman Powell's goal is to control the US CPI within 2%, but the data of 8.3% in August is very high. The market expects to reach Powell's target, and the Federal Reserve's interest rate hike must reach more than 4.5%; but the continued rise of the US dollar has made the yield of US bond higher, which means that the rise of the US dollar is difficult to sustain, otherwise there will be risks of triggering the US bond crisis .
Dow Jones Index (down 1.7%), Nasdaq Index (1.79%), and S&P 500 Index (down 1.71%) fell simultaneously, and its position was in the downward low range, which means that US stock will test its low again. At the same time, the leading U.S. stock Tesla fell slightly by 2.57%, Amazon fell 2.99%, Apple 2.03%, and the leading stocks synchronous index fell.
3, Shanghai Index , GEM Index Trend Analysis
A shares A shares As Due to the impact of the Fed's interest rate hike, the ChiNext Index (falling 0.52%), the Shanghai Composite Index (falling 0.27%) and the Shenzhen Component Index (falling 0.84%) fell simultaneously, and the trend was still down; the index closed below the 5-day, 10-day and 20-day moving averages, and the A-share index was in a downward cycle without changing, but after continuous declines, the index's slight fluctuation shadow was longer, and there was an opportunity to change 's unilateral decline in .
4. Summary of Wenqutang Stock Market Trading Experience
In the bottom area of the stock market, analyze and study sectors that were wrongly killed, seriously undervalued sectors, especially industries that can drive the index rise, after the market bottomed out and rose, this type of sector has better opportunities.
The securities sector began to decline in July 2020, with a decline cycle of more than 24 months. Guotai Junan and Haitong Securities have fallen below its net assets, and the leading CITIC Securities is close to its net assets; this is rare in the securities sector with less history, and this sector is worthy of focus research!
Dear, likes is the greatest encouragement to the author. Please use your good luck to follow Wenqutang . I will share financial knowledge every day, thank you !
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-