The RMB exchange rate has shown signs of rebounding recently.
On June 6, the central parity rate of the RMB against the US dollar was raised by 404 basis points.On the morning of the 6th, the exchange rate of the onshore renminbi against the US dollar rose above 6.64 yuan, hitting a new high in nearly a month.
Where will the RMB exchange rate go in the future?
Onshore RMB exchange rate rebounds
On the first trading day after the short holiday, the RMB exchange rate continued to rebound.
On the morning of June 6, as of 11:30, the onshore RMB exchange rate against the US dollar was 6.6535 yuan, up 215 basis points from the previous closing price.The market exchange rate once rose above 6.64 yuan during the session, and the highest reported at 6.6391 yuan, hitting a new high in nearly a month.
The central parity rate of the RMB against the US dollar announced by the Foreign Exchange Trading Center in the morning was 6.6691 yuan, an increase of 404 basis points from the previous value.
The exchange rate of the offshore renminbi against the U.S. dollar has fallen, and as of 11:30, it was reported at 6.6593 yuan, down 56 basis points from the closing price of the previous trading day, but still at a recent high.
Before the Dragon Boat Festival, the RMB exchange rate has shown signs of rebounding.On June 2, the onshore RMB exchange rate against the U.S. dollar rose by 191 basis points; the offshore RMB exchange rate against the U.S. dollar rose even more, up 442 basis points in a single day to 6.6540 yuan.On June 3, the exchange rate of the still-traded offshore yuan against the U.S. dollar briefly rose to 6.6164 yuan, a new high since May 5.
Why did the RMB exchange rate stop falling and rebound?
The team of Li Liuyang of CICC believes that under the influence of the US dollar index peaking and correction, the domestic epidemic situation continues to ease, and the confidence in economic stabilization is strengthened, there are obvious signs that the RMB exchange rate against the US dollar has stopped falling in the short term.
Back to Two-Way Volatility
The team of Li Liuyang believes that the period of rapid depreciation of the RMB exchange rate may have ended.In the second half of the year, the long and short factors affecting the central change of the RMB exchange rate are relatively balanced. The peaking of the US dollar, the economic rebound and the adjustment of export tariffs to the United States may become important forces supporting the RMB exchange rate; while external demand pressure and valuation revisions may become a weakening force for the RMB exchange rate; The impact of cross-border receipts and payments is also relatively balanced.
"Overall, the RMB exchange rate will stabilize around 6.65 yuan in the second half of this year. The RMB exchange rate will return to two-way fluctuations," the team said.
"There are foundations and conditions for the RMB exchange rate to remain basically stable." Guan Tao, global chief economist of BOC Securities, analyzed that China has a large trade surplus, direct investment is a net inflow, private foreign exchange assets holdings have increased, macro-prudential measures, capital foreign exchange management and foreign exchange Under the "five-layer protection" of reserve intervention, China has the foundation and conditions to keep the RMB exchange rate basically stable at a reasonable and balanced level.
Guan Tao said that in the second half of the year, we must pay attention to the impact of economic recovery, the US dollar index, and the epidemic situation on the exchange rate.
Pan Gongsheng, deputy governor of the People's Bank of China, said recently that the RMB exchange rate fluctuates in both directions and remains basically stable at a reasonable and balanced level.
Pan Gongsheng said that market institutions believe that the Fed is more difficult to stabilize the economy while controlling inflation, and the tightening of monetary policy in the euro zone has strengthened, which has caused the dollar exchange rate to drop recently.In addition, with the relief of the epidemic and the effects of various policies to stabilize growth, the advantages of domestic production and supply continue to exist, and trade in goods is expected to maintain a reasonable surplus.At the same time, with the opening up of my country's financial market, the return on investment in RMB assets is stable, which will continue to attract foreign investors to invest in China.
"Compared with the previous five months, the stable operation of my country's foreign exchange market has a better foundation." Pan Gongsheng said.
(Editor in charge: Ma Xin)
