The RMB Exchange Rate Has Entered The "Consolidation" Period.

Depreciation or slight appreciation? The recent RMB versus US dollar. exchange rate The central parity price is in the range of 6.37 to 6.32, and it is trying to draw a larger exchange rate curve.

More marketable USD / RMB (Hongkong) spot exchange rate The fixed price is between 6.54 and 6.39. Huge Fluctuations show that the RMB exchange rate in Hongkong has averaged 1% lower than that in the mainland in the past month.

In October 28th, the central parity of RMB against the US dollar was quoted at 6.3290 yuan, and the exchange rate changed to a new high. Market participants believe that if the middle price is not supported, the renminbi is likely to derogate.

However, Libra seems inclined to depreciate the expected sound. Data show that export growth in September dropped to a low level since February of this year, and foreign exchange reserves in September dropped by 60 billion 800 million US dollars in January. The central bank and the Ministry of Commerce say that the RMB exchange rate tends to be at an equilibrium level.

Li Daokui, director of the China and World Economic Research Center at Tsinghua University, said recently that the devaluation pressure of the renminbi is greater than the risk of appreciation pressure. (micro-blog) However, Professor Wu Nianlu, director of the Graduate School of the central bank, believes that although the renminbi appreciation factor is declining, the RMB exchange rate, which is affected by the market supply and demand, will rise slightly in the fluctuation.

According to Shen Lan, China's macro economist at Standard Chartered Bank, the RMB will rise to 6.31 at the end of the year, according to the standard of 5% to 6% appreciation. When the currency policy is "changing tone", the RMB exchange rate will deduct a new trend of volatility.

Two contradictory exchange rate curves

In October 27th, the US dollar / Renminbi (Hongkong) spot exchange rate was fixed at 6.4006; Wednesday was 6.4110, Zhou Erwei 6.3992; Monday was 6.4127. The offshore renminbi (CNH) market in Hongkong has remained calm for nearly a week.

In the onshore RMB market, the 27 yuan in the central parity of RMB against the US dollar is 6.3477, which is 529 basis points different from the fixed price of RMB (Hongkong) spot exchange rate of 6.4006, and depreciated 0.8%.

A person close to the Hongkong monetary authority once said that after entering October, the clearing bank's net purchase and sale of Renminbi in Hongkong, China, increased from 4 billion to 8 billion, and the expected depreciation of the renminbi will be weakened by Hongkong.

However, at the end of 10, the spread of the 529 base points is also non decimal, indicating that the RMB devaluation is still high.

"The mainstream is the price of RMB against the US dollar, and the price difference between the CHN and the CHY market will gradually shrink. The Hongkong RMB market is not enough to affect the domestic exchange rate." An official said.

In fact, more and more scholars or experts have recently been able to judge the pressure of devaluation. In addition to Xie Guozhong, an independent economist, Mr Li also believes that the impetus for RMB appreciation is insufficient. HSBC China's chief economist, Qu Hongbin, also said that the renminbi is not undervalued, but there is no need for further appreciation.

Meanwhile, in October 11th, after the US Senate voted to pass the renminbi exchange rate bill, the US government is still putting pressure on the RMB exchange rate. On October 25th, Lyle Brainard, Vice Minister of finance, said that the yuan appreciated nearly 40% against the US dollar in the past five years, but it is still underestimated. Although Renard said frankly that the appreciation of the RMB itself can not solve the trade deficit of the United States, she stressed that the US government will continue to take bilateral and multilateral measures to deal with the issue of RMB exchange rate.

Two-way fluctuations become normal.

Recently, the trend of the central parity of RMB exchange rate has been very entangled, and it has been "consolidated" in the 6.37 and 6.32 intervals.

CICC's latest report predicts that China will maintain a favorable balance in the coming months, but the annual surplus will be lower than that of last year. The flexibility of RMB will increase, but the possibility of significant appreciation will not be great.

"Frequent two-way fluctuations will become a norm." Zhao Qingming, an international financial expert, said, "whether there is a current account or a capital account, as long as there is a favorable balance, there is a need for RMB appreciation."

However, behind the fluctuating exchange rate curve, there may be a contest and adjustment related to international relations and interests.

In fact, "after the RMB enters the" consolidation period ", we need to analyze the trend from the supply-demand relationship. Wu Nianlu said. He believes that now the depreciation of appreciation factors, the reduction of foreign trade surplus, the reduction of foreign reserves, and the transformation of export enterprises are at the critical moment of upgrading, and the overall trend of RMB exchange rate is appreciating slightly in fluctuation.

The approach to policymakers is that, based on China's actual conditions, a slight appreciation of the renminbi is the best option under China's limited options.

"The renminbi is still undervalued, and, if it is stopped, it is not a good time now." Shen Lan said. She predicts that if there is no accident, the renminbi will continue to appreciate. At the end of this year, the RMB will rise to 6.31 against the US dollar, the appreciation will be between 3.5% and 4% next year, and the RMB exchange rate will reach 6.06 by the end of next year.

In fact, in the view of Shen Lan, the RMB exchange rate fluctuated after entering the consolidation period, and the degree of marketization is high. Increasing the volatility is one of the reform directions of China's exchange rate formation mechanism.

Ward, chairman of the board of directors of Asset Management Co in Hongkong, Lu Qiyuan, said Li Daokui's judgment of RMB depreciation has two premises: assuming that there is no new round of quantitative easing in the US dollar, assuming monetary tightening policy remains unchanged. If the US launches QE3, the renminbi will not depreciate, but will also appreciate significantly. But all this is still unknown.

Coincidentally, the prelude to the tone of China's monetary policy has been heard. Shen Jianguang, managing director of Mizuho Securities Asia, believes that, such as the recent intensive research conducted by the government, it has proposed measures to ease local financing platforms and support the development of small and medium-sized enterprises. As a result, the RMB exchange rate under the change of monetary policy will deduce a new trend of volatility.