Xinhua News Agency: the recent devaluation of the RMB

RMB devaluation currency bank

shanghaizhengquanbao· 2016-10-20 04:31:12

recent RMB against the U.S. dollar continued downward, the middle of a series of 6 year lows refresh, causing the market to worry about the devaluation of the rmb. In this regard, the experts believe that the RMB against the U.S. dollar fell mainly by the strong impact of the dollar, in the short term this pressure will continue to fear. However, the future of two-way floating RMB exchange rate will become the norm, taking into account the fundamentals of China's economy is still robust and RMB internationalization progress, the RMB does not have the trend of depreciation base.

strong dollar is the main cause of the

dollar index rose is the main source of the recent devaluation of the rmb. Fed by the fed in December to raise interest rates expected to heat up the impact of the U.S. dollar index recently hit the highest level since March, once exceeded 98 mark.

"the dollar is strong enough," said Richard Grace, chief currency strategist at Bank of Commonwealth of Australia, told Xinhua. He pointed out that the Fed rate hike sword hanging and continue to release the signal under the background of the rising dollar momentum strong, non dollar currencies generally weaker. But China's economic fundamentals are healthy, the market does not need to worry too much.

in fact, although the RMB against the U.S. dollar fell to a 6 year low, but still appreciate against other currencies. U.S. Bloomberg reported that last week, the RMB against the U.S. dollar fell by 0.8%, but the RMB against the trade weighted basket of currencies is still up 3, the largest increase in 0.6% months.

in addition to the Fed's interest rate hike expectations, the British government's hard to take off the European trend is also exacerbated by market uncertainty. The Northumbria University Newcastle Business School professor Xiong Yu said in an interview with Xinhua, the British "off the European" uncertainty leads to the pound against the dollar plummeted, the dollar hedge function is more prominent, including the renminbi by emerging market currencies fell against the dollar had.

two-way volatility or a normal

market volatility is the norm, but also the RMB exchange rate mechanism in the process of improving the market level of the required course". Over the past year, China's central bank has taken a series of measures to improve the formation mechanism of the RMB exchange rate market. James Laurensson, vice president of University of Technology Sydney Institute of

Australia told Xinhua: "Chinese has experienced a period of relatively stable exchange rate, but the process of RMB exchange rate to the market further, inevitably there will be more volatility. Deputy director of the Asia Pacific Department

IMF Max Rodwell said that the RMB exchange rate seems to have been successful from the dollar to the reference to a basket of currencies, become more market-oriented and flexible, the RMB exchange rate in the short term speculative forces bet unilateral devaluation has decreased.

, senior fellow at the Brookings Institution Du Dawei also believes that to maintain the RMB exchange rate against a basket of currencies stable given China policymakers more flexibility, making the RMB do not follow the U.S. passive appreciation, in line with the current trend of economic development Chinese. Influence of

on the short term, the renminbi weakness of Grace that "this may increase the pressure of capital outflow of domestic Chinese, (but) take Chinese monetary authorities measures is very successful, firmly hold RMB Offshore and onshore exchange rate difference. "

of the Fordham University business school, vice president Yan An Gabelli believes that the devaluation of the domestic financial market impact is limited, on the one hand, this market is expected to, on the other hand, China has huge foreign exchange reserves, and China capital market has not fully liberalized, the central bank has a strong regulatory capacity, not disorderly depreciation of rmb. The future of

stabilized emboldened

analysts believe that the Fed's interest rate rise slowly, the dollar strong influence and other factors, the RMB exchange rate will remain relatively weak, but has a high dollar index or callback, and the U.S. economy supports only slow rates, these factors mean that the continuous devaluation of the RMB Limited space.

in the long term, China's current account surplus, abundant foreign exchange reserves, financial stability and other factors determine the downward trend of the RMB exchange rate is not likely to evolve into a long-term trend. To further promote the future of RMB internationalization, the gradual opening up of financial markets, the international market for the RMB asset allocation growing interest and other factors will support the formation of the RMB exchange rate.

of the Pedersen Institute for International Economics senior fellow and honorary director Fred Bergsten recently said that the RMB exchange rate does not exist the continued depreciation of the foundation, he is optimistic about the exchange rate of rmb.

UAE National Bank of Dubai chief investment officer Gary Dugan said in an interview with reporters, in recent years, especially the Middle East Gulf RMB continue to increase, the first RMB clearing center in the Middle East last year established in Qatar, the United Arab Emirates in the clearing bank for RMB business is expected to set up at the end of this year. The trend of internationalization of the RMB will not be affected by the current short-term devaluation.

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