Experts believe that the economic situation, the attitude of the central bank and the flow of funds all point to the fact that the US dollar has entered a strong channel.
The mid-price of the yuan against the U.S. dollar was 6.5029 on the 16th, depreciating by 19 basis points; experts believe that the high point of the mainland domestic boom may have appeared, and the appreciation of the yuan may be nearing its end.
The onshore yuan closed at 6.5031 at 16:30 on the 15th and 6.4998 at 23:30 overnight.
In addition, the People’s Bank of China announced that in order to maintain a reasonable abundance of liquidity in the banking system, it conducted a RMB 10 billion 7-day reverse repo operation by way of interest rate bidding on the 16th, with a winning rate of 2.20%.
Zhao Wei, chief economist of Open Source Securities, was quoted by China Business News as saying that with the subsequent gradual strengthening of the U.S. dollar index, the high point of the mainland domestic boom may have appeared and the appreciation of the yuan may be nearing its end.
He believes that there are three logics supporting the gradual strengthening of the dollar index. The first is that with access to a more adequate supply of vaccines and faster progress in vaccination, the control of the Epidemic in the United States will gradually be better than in Europe, and the pace of economic repair is faster than in Europe. Secondly, the U.S. policy stimulus is much stronger than other economies such as Europe, and the former therefore has the greatest elasticity for economic recovery upward. In addition, the faster pace of economic repair supported by the U.S. Federal Reserve policy exit is expected to heat up earlier than the European Central Bank and others.
In addition, Zhao Wei believes that the economic situation, central bank attitudes and capital flows all point to the dollar having entered a strong channel.
Societe Generale Research expects that U.S. bond yields will still continue to rise, and yields will help the U.S. dollar index rebound after entering the allocation range. In the short term, the U.S. dollar against the yuan exchange rate “grinding the top”, after the market may fluctuate against the yuan exchange rate range expansion, but not hinder its range oscillation market.
Recent Comments