Look at the news knews reporter Yang Zhen
2021-05-28 22:42
The appreciation of the renminbi has advanced into the 6.3 yuan era!
Data from the China Foreign Exchange Trading Center showed that the yuan was quoted at a median exchange rate of 6.3858 against the us dollar on May 28, up 172 basis points from the previous session, entering the 6.3 yuan era and hitting a three-year high.
The exchange rates of the onshore rmb and offshore RMB also continued to rise, both entering the 6.3 yuan era. Among them, the onshore yuan closed at 6.3654 today, up 104 points from 6.3758 in the previous session.
In fact, since April this year, the renminbi has continued to appreciate against the US dollar. In just over a month, both onshore and offshore renminbi rose more than 2 percent. Looking back a year ago on May 28, the yuan's midpoint against the dollar was 7.1277, which means that the renminbi has appreciated by 7419 basis points over the course of a year.
What is the reason for the continued appreciation?
So, what is the reason for the recent continuous appreciation of the renminbi? Tan Yaling, president of the China Foreign Exchange Investment Research Institute, believes that it can be viewed from the perspective of "inside and outside".
Internally, market sentiment and expectations are more important factors. Recently, some scholars have proposed that "the renminbi will continue to appreciate against the US dollar in the medium and long term, and under the condition of RMB internationalization, the People's Bank of China will eventually abandon the exchange rate target", which has aroused market concern and is considered to have a certain role in fueling the appreciation of the renminbi in this round. At the same time, China's economy continues to recover, and the market's bias towards the appreciation of the renminbi is also more serious.
From an external point of view, the most immediate factor comes from the depreciation of the dollar. Since the outbreak of the epidemic in 2020, the Federal Reserve has implemented a super-large quantitative easing policy since March 2020, and the dollar supply has grown rapidly. Entering April this year, the dollar index went all the way down, from the highest 93.4412 to the lowest 89.6509, a drop of more than 4%. The weakening of the dollar across the board has led to the rise of the world's major currencies. According to the statistics released by Reuters on the 27th, the euro appreciated by more than 4.3% in the first quarter of this year, and the renminbi appreciated by 2.5%, which is comparable to the appreciation of the Russian ruble, the Mexican dollar and the british pound.
In addition, foreign investors hope to obtain greater interests in the Chinese market, which further boosts the appreciation of the renminbi. Tan Yaling said that the degree of opening up of the Chinese market and the policy of opening up are very clear, and in international economic or financial relations, our advantages in spreads and exchange rates also exist, which brings room for arbitrage and hedging to the allocation between local and foreign currencies. Therefore, the phenomenon of foreign capital taking advantage of favorable opportunities to arbitrage and hedge is relatively common, which also stimulates the appreciation of the renminbi.
Data show that since May 25, northbound funds began to frantically net buy A shares, and the net purchase on the 25th exceeded 21.7 billion yuan, refreshing the record of the highest net purchase in the history of a single day. On the 26th, the northbound funds bought another 9 billion yuan; on the 27th, the northbound funds still did not slow down, with the net purchase of 6.338 billion yuan in the Shanghai Stock Connect and 8.289 billion yuan in the Shenzhen Stock Connect, with a total net purchase of up to 14.627 billion yuan.
Is the appreciation of the renminbi a good thing?
The appreciation of the renminbi means that the money in the hand has become more valuable, is this a great thing? For those who want to travel, shop and study abroad, it is indeed good news, but it will bring greater pressure for export enterprises.
Tan Yaling, president of the China Foreign Exchange Investment Research Institute, said that the appreciation of the renminbi, the superposition of multiple factors such as rising raw material prices and rising maritime prices will undoubtedly hit export enterprises more seriously, and will further compress the profits and living space of small and medium-sized foreign trade enterprises. The increase in the cost of export products will also affect the international market competitiveness of export enterprises' products, and there will also be certain exchange rate risks, resulting in exchange losses.
Tan Yaling also reminded that as the world's largest exporter of goods, among China's foreign trade enterprises, private enterprises and small and medium-sized enterprises account for almost half of foreign trade exports, and the impact of RMB appreciation on the exports of Chinese enterprises needs to be paid great attention to.
So, the appreciation of the renminbi is not conducive to exports, for import enterprises, can reduce procurement costs, increase profits, is not a big positive? Tan Yaling believes that this should also be marked with a question mark.
"When an importing enterprise buys raw materials or commodities, he will take into account the favorable exchange rate and exchange RMB for US dollars to buy more foreign products, but many foreign products are also rising with the growth of commodity raw materials and shipping prices, and the price of the products he actually buys is not necessarily cheap," Tan Yaling said. Therefore, the impact of RMB appreciation on import and export enterprises cannot be underestimated, and the impact of the exchange rate itself on enterprises or on the economy will have a lagging effect, and the impact on the economy in the next three months or the second half of the year is worth paying attention to.
What is the meaning of the official intensive voice?
The continued appreciation of the renminbi has also aroused the attention of the financial sector. Within 7 days, the Seventh Working Conference of the Financial Stability and Development Committee of the State Council, the Central Bank, and the Self-Discipline Mechanism of the National Foreign Exchange Market has successively spoken out on the RMB exchange rate, which is relatively rare.
Yesterday, the seventh working meeting of the national foreign exchange market self-discipline mechanism was held in Beijing, and the meeting held that the exchange rate cannot be used as a tool, can not be used to depreciate to stimulate exports, nor can it be used to appreciate to offset the impact of rising commodity prices. The meeting stressed that we should not bet on the appreciation or depreciation of the RMB exchange rate, and we will lose if we gamble for a long time.
Last Sunday, Liu Guoqiang, deputy governor of Chinese Bank, said that the future trend of the RMB exchange rate will continue to depend on market supply and demand and changes in the international financial market, and two-way fluctuations have become the norm. On the 21st of this month, the 51st meeting of the Financial Stability and Development Committee of the State Council called for further promoting the market-oriented reform of interest rate exchange rates and maintaining the basic stability of the RMB exchange rate at a reasonable and balanced level.
Tan Yaling said that the continuous and rapid appreciation of the renminbi in a certain period of time is an anomaly, which does not fully match China's current stage of development and development level, and there are risks. A series of official shouts show that our policy department has realized this, and it is also a correction of the recent trend of the RMB exchange rate to stabilize market expectations.
In the coming period, Tan Yaling believes that there is little room for the RMB exchange rate to continue to appreciate sharply, and the RMB will return to the stage of two-way fluctuation bias towards depreciation. "But the market is very speculative, and the desire of foreign investors to appreciate the renminbi is also very high, and next, there may be a larger game and competition in the internal and external markets," Tan Yaling said. "However, whether it is depreciation or rise, our mentality should be calm, be prepared for both hands, do not gamble or guess, and take good risk prevention and control measures, which is crucial for us to cope with exchange rate changes."
(Look at the news knows reporter Yang Zhen)