US$100,000 can be exchanged for an extra RMB10,000
The exchange rate of RMB to USD has hit a 4-month low. The picture shows the schematic.
On March 30, the onshore price of the yuan against the U.S. dollar (CNY) closed down 51 points at 6.5677 yuan to the U.S. dollar, hitting a near 4-month low.
The onshore price of the yuan against the U.S. dollar closed at 6.5677 on the 30th, down 51 pips or 0.08% from the previous day’s 4:30 p.m. close of 6.5626; the offshore price (CNH) even fell below 6.58 during the day to a low of 6.5836; the official mid-price was 6.5641, down 225 pips or 0.34% from the previous day’s 6.5416, falling to a new low of nearly four months.
“Brokerage China” news shows that the yuan against the dollar exchange rate intermediate price, onshore price market and offshore market all hit a new low since December 2020. Since December 2020, with the onshore yuan peaking at 6.4236 against the U.S. dollar, US$100,000 has appreciated against the yuan by about 14,000 yuan in four months as the yuan exchange rate has fallen.
In this regard, Hong Kong‘s “Hong Kong Economic Journal” quoted traders’ analysis that the hedge demand triggered by the hedge fund position explosion continues to push the dollar close to the 93 mark, while the U.S. bond yields continue to rise also supports the dollar, the short-term yuan or test the 6.6 mark support.
Some traders also said that the regulator reintroduced the rising flexibility of the yuan exchange rate, the subsequent reaction to the fluctuations of the yuan against the dollar is expected to increase, if the dollar is strong in the short term, the yuan decline or increase; in addition, China-US tensions are difficult to ease, the yuan may also face pressure next.
According to Reuters’ analysis, the strong trend of RMB has changed, and the subsequent RMB faces a “catch-up” market. The dollar is affected by the new round of U.S. fiscal stimulus landing, increasing the economic recovery and spread advantage, the follow-up U.S. will also plan to promote large-scale infrastructure construction, the Federal Reserve policy tightening is expected to heat up, these have played a boost to the dollar, the dollar outlook seems more and more bullish.
As for the yuan, political friction between China and Europe and the US may have more impact on the yuan if it affects the economy.
Analysis by “Brokerage China” shows that with the deletion of the phrase “no sharp turn” in the press release of the authorities’ regular monetary policy meeting in the first quarter, there has been a lot of discussion recently on whether the tone of the central bank’s monetary policy will change. The latest central bank banker questionnaire also reflected that the credit market tends to be in short supply, with the overall loan demand index at 77.5% during the reporting period, up 5.9 percentage points from the previous quarter and 11.6 percentage points from the same period last year. And the possibility of financing costs for the real economy entering an upward trend is extremely high.
The central bank’s monetary policy will be the next window of observation in mid-April, as April and May are the traditional tax payment months. The central bank’s hedge will be the window to observe whether the tone of the central bank’s monetary policy will be fine-tuned.
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