On October 17, according to the market trend chart, today, the offshore RMB exchange rate "opened flat and closed high", rising slightly. As of now (11:48), the offshore RMB exchange rate has risen by 214 points, returning to below 7.2000, at 7.1966.
However, last Friday, the offshore RMB exchange rate fell sharply, closing at 7.2180. Today, the offshore RMB exchange rate "stops falling and turns to rise" and returns to below 7.2000. Does this indicate that the offshore RMB exchange rate will rise further?
Regarding this question, the editor thinks that in the short term, the probability of the offshore RMB exchange rate further increases is very high. On October 13, the US announced that the unseasonally adjusted CPI annual rate in September was "higher than" market expectations and was "undervalued" by 0.1 percentage point, which increased the pressure on the Federal Reserve to suppress inflation, and at the same time, it also heated up the market expectation of the Federal Reserve to continue hiking interest rates by 275 basis points in November.
data shows that the US unseasonalized CPI annual rate in September was 8.2%, the expected value was 8.1%, and the previous value was 8.3%.
Everyone knows that as the Fed continues to raise interest rates by 75 basis points in November, it will inevitably lead to global capital flowing to the United States again, causing the non-US currencies to further depreciate.
, but further depreciation of the currency of non-US will continue to increase inflationary pressure in non-US countries, especially energy importers, such as European countries, Japan, China, India, South Korea, the United Kingdom and other countries. Because the appreciation of the US dollar will inevitably lead to the depreciation of non-US currencies, and crude oil is quoted in US dollars, so once the US dollar appreciates further, the inflationary pressure of non-US countries will continue to increase.
In other words, in order to cope with this situation, non-US countries will inevitably suppress the Eight Immortals who show their magical powers across the sea. The dollar index will further rise. Therefore, the editor feels that in the short term, the probability of the offshore RMB exchange rate further rise is very high.
One, in 2022, due to the military conflict between Russia and Ukraine and the economic sanctions imposed by Western countries on Russia and on Russia, international oil prices have become "high". The "high" international oil prices are also the main driving force for the continued rise in inflation in European countries.
In response, in order to cope with the impact of rising international oil prices on their economy, European countries competed to issue energy subsidies, which not only further increased the inflationary pressure in euro zone, but also continued to expand the fiscal deficit of European countries.
In the future, if response measures are not taken in a timely manner, control them, and allow them to develop, it is not impossible for euro zone to re-emerge financial crisis.
Therefore, Pierre Wunsch, a member of the ECB's governance committee and Belgian central bank governor, said that as governments compete to issue energy subsidies, the ECB may have to raise interest rates more aggressively to calm record high inflation.
As we all know, as of September, the European Central Bank has raised interest rates by 125 basis points, namely 50 basis points in July and 75 basis points in September.
In the last two months of this year, the European Central Bank may hike interest rates by no less than 75 basis points in September in order to calm record high inflation.
At present, due to the rising market expectations of further interest rate hikes in the euro zone, this not only made the increase in the US dollar index "restricted", but also caused the euro to appreciate slightly.
According to the market trend chart, the exchange rate of the US dollar against the euro has fluctuated and fell recently. From October 13, as of 15:19 on October 17, the exchange rate of the US dollar against the euro has fallen by 51 points in three trading days, that is, the euro appreciates by 0.49% relative to the US dollar.
Recently, the pressure on the decline of the offshore RMB exchange rate has been weakened due to the slight appreciation of the euro against the US dollar. The reason is that the exchange rate of the euro against the US dollar accounts for as high as 50% of the US dollar index, so the weakening of the expectation of further rise in the US dollar index will inevitably increase the expectations of the rise in the offshore RMB exchange rate.
Secondly, the Bank of Japan has once again been "tightened" as the exchange rate of the US dollar against the yen continues to rise recently. In other words, in the future, Japan will also take measures to curb the further rise of the US dollar index.
According to the market trend chart, starting from October 5, as of 15:28 on October 17, the exchange rate of the US dollar against the Japanese yen has risen by 4,742 points in 9 trading days, that is, the yen depreciated by 3.29% relative to the US dollar.
In response to this, Bank of Japan Finance Minister Suzuki Shunichi urgently stated that the authorities will take appropriate actions to prevent excessive exchange rate fluctuations. Japan cannot tolerate excessive fluctuations caused by speculation and is focusing on the foreign exchange market with a high sense of urgency and will take appropriate measures to deal with excessive fluctuations.
Next, if the Bank of Japan and the Ministry of Finance further buy the yen and sell the US dollar, then the US dollar index will inevitably fall under pressure. Therefore, the editor feels that in the short term, the probability of the offshore RMB exchange rate further rise is very high.
In September, Japan spent nearly $20 billion on its first intervention in more than 20 years. Therefore, in September, the exchange rate of the US dollar to the Japanese yen was consolidated between 144.751 and 142.251.
Third, in September, my country's CPI annual rate increased by 0.3 percentage points month-on-month, while PPI annual rate decreased by 1.4 percentage points month-on-month, which will inevitably heat up my country's future economic growth expectations, thus forcing the offshore RMB exchange rate to rise.
data shows that China's September CPI annual rate was 2.8%, the expected value was 2.8%, the previous value was 2.5%. China's September PPI annual rate was 0.9%, the expected value was 1%, and the previous value was 2.3%.
Therefore, the editor feels that under the combined effect of these factors, the probability of the offshore RMB exchange rate further rising in the short term is very high. What do you think about this? Is it consistent with the editor's point of view?
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