The central bank takes action! Foreign exchange risk reserve ratio0Up to20%, the offshore RMB rose sharply... How will the exchange rate go in the future? .. ...

2022-9-27 09:46| Publisher: 2233| see: 440| comment: 0|come from: Securities Times

abstract: Whether9month5The People's Bank of China decided to lower the foreign exchange reserve ratio of financial institutions2Percentage points, or the People's Bank of China raised the foreign exchange risk reserve ratio of forward foreign exchange sales to20%These are all measures taken by the Central Bank to cope with the recent pressure of RMB devaluation against the US dollar.9month26The People's Bank of China announced that ...
Whether9month5The People's Bank of Japan has decided to downgrade financial institutionsforeign exchangeDeposit reserve ratio2Percentage points, or the People's Bank of China raised the foreign exchange risk reserve ratio of forward foreign exchange sales to20%These are all measures taken by the Central Bank to cope with the recent pressure of RMB devaluation against the US dollar.

The central bank takes action! Foreign exchange risk reserve ratio0Up to20%, the offshore RMB rose sharply... How will the exchange rate go in the future? .. ...438 / author: / source:Securities Times

9month26On the same day, the People's Bank of China announced that in order to stabilize the expectations of the foreign exchange market and strengthen macro prudential management, the People's Bank of China has decided to2022year9month28Starting from today, the foreign exchange risk reserve ratio for forward foreign exchange sales business will be reduced from0Up to20%。 After the news was sent, the offshore RMB rose sharply against the US dollar300Points.

As a policy tool for the central bank to stabilize the foreign exchange market, the last time the People's Bank of China adjusted the foreign exchange risk reserve ratio for forward foreign exchange sales business was2020year10month12It has been nearly two years since the central bank launched another attack on Japan.

Experts say that the central bank has raised the foreign exchange risk reserve ratio for forward foreign exchange sales business this time, aiming to increase the forward foreign exchange purchasing cost for bank customers and avoid excessive accumulation of short selling expectations in the foreign exchange market. The current policy has begun to release signals of stabilizing exchange rates. Considering that the current RMB exchange rate has not experienced a rapid depreciation away from the US dollar trend, the central bank's regulation has a proactive nature and aims to further stabilize the expectations of the foreign exchange market.

Reduce the demand for long-term foreign exchange purchases by enterprises

As a policy tool for the central bank to stabilize the foreign exchange market, the last time the People's Bank of China adjusted the foreign exchange risk reserve ratio for forward foreign exchange sales business was2020year10month12It has been nearly two years since this adjustment.

Forward foreign exchange sales business is a derivative product of exchange rate hedging provided by banks to enterprises. Enterprises can to some extent avoid future exchange rate risks through forward foreign exchange purchases, but due to the fact that enterprises do not immediately purchase foreign exchange and banks need to purchase foreign exchange in the spot market, this will affect the spot exchange rate, which in turn will affect the forward foreign exchange purchasing behavior of enterprises. This procyclical behavior can easily evolve into the 'herd effect'.

stay2015Year“8.11”Afterwards, in order to curb excessive fluctuations in the foreign exchange market, the People's Bank of China incorporated the bank's forward foreign exchange sales business into the macro prudential policy framework, and charged foreign exchange risk reserves for financial institutions conducting forward foreign exchange sales business on behalf of customers, with a reserve ratio of20%。

differ2020year10month12The People's Bank of Japan has lowered the foreign exchange risk reserve ratio for forward foreign exchange sales business to0The central bank has decided to increase the foreign exchange risk reserve ratio from0Up to20%。

Wen Bin, Chief Economist of Minsheng Bank, stated that this move increases the cost of bank forward foreign exchange sales, reduces the demand for enterprise forward foreign exchange purchases, and thus reduces the demand for spot market foreign exchange purchases, which helps to balance supply and demand in the foreign exchange market.

Pang Ming, Chief Economist and Head of Research at Jones Lang LaSalle in Greater China, also pointed out that the People's Bank of China has adopted the countercyclical adjustment tool of raising the foreign exchange risk reserve ratio, which increases the cost of funds for banks to engage in related businesses and the cost of enterprises purchasing US dollars in the future, reduces non real demands such as arbitrage demand in the forward foreign exchange purchasing demand, and constrains irrational behavior in the forward foreign exchange market, Suppressing excessive fluctuations and unilateral expectations in the foreign exchange market, preventing excessive depreciation or appreciation of the RMB, is conducive to maintaining a two-way fluctuation of the RMB against the US dollar at a reasonable and balanced level.

The central bank actively takes action to stabilize expectations in the foreign exchange market

Whether9month5The People's Bank of China decided to lower the foreign exchange reserve ratio of financial institutions2Percentage points, or the People's Bank of China raised the foreign exchange risk reserve ratio of forward foreign exchange sales to20%These are all measures taken by the Central Bank to cope with the recent pressure of RMB devaluation against the US dollar.

since8month12Recently, the exchange rate of the Chinese yuan against the US dollar has shown a rapid depreciation trend.9month15In the evening, the offshore RMB/USD exchange rate broke“7”Integer level, followed by9month22On the day, the offshore RMB exchange rate broke through against the US dollar7.1Gateway.

Pang Ming stated that the central bank has clearly released a policy signal to stabilize the foreign exchange market expectations and maintain the basic stability of the RMB exchange rate at a reasonable and balanced level, indicating the determination to maintain the policy goal of exchange rate stability, "cooling down" the expectation of unilateral depreciation of the RMB, and is expected to alleviate the pressure of rapid depreciation of the RMB, promote supply and demand balance in the domestic foreign exchange market, and return the trend of the RMB exchange rate to a reasonable and balanced level, It can to some extent suppress the expectation of unilateral depreciation of the RMB exchange rate, irrational overshoot, and the possible "herd effect".

Wang Qing, Chief Macro Analyst of Dongfang Jincheng, pointed out that looking forward to the future, the US dollar will continue to operate strongly for a period of time due to the continued significant interest rate hikes by the Federal Reserve and geopolitical factors driving safe haven demand. Before the end of the year, the RMB still has a passive depreciation trend against the US dollar, but this does not mean that the RMB is in a substantial weakness or exchange rate risk is increasing. One sign is the three major RMB exchange rate indices(CFETS\BIS\SDR)It will maintain basic stability. The depreciation of the RMB against the US dollar in the short term will not pose a significant constraint on the flexible adjustment of domestic macroeconomic policies.

How will the RMB exchange rate move in the future?

In recent times, the Federal Reserve has accelerated its tightening of monetary policy to curb high inflation. As the US dollar index continues to strengthen, most non US dollar currencies, including the Chinese yuan, have experienced varying degrees of depreciation. However, compared to major developed economy currencies such as the pound, euro, and yen, the depreciation of the renminbi is relatively small, and the renminbi exchange rate index is generally stable.

Data display,1~8In January, the euro depreciated12%The pound has depreciated14%The yen has depreciated17%RMB depreciation8%。 The depreciation of the RMB is relatively small, andSDRIn the basket, it should be said that the Chinese yuan appreciates against non US dollar currencies except for the depreciation against the US dollar, rather than against themSDROther currencies in the basket also depreciate. staySDRIn the currency basket, a basic situation is that the US dollar has appreciated and the Chinese yuan has also appreciated, but the appreciation of the US dollar is greater than that of the Chinese yuan. So, there has not been a comprehensive depreciation of the RMB. Liu Guoqiang said.

According to the market analysis, under the background of the strong interest rate increase and acceleration of tightening by the Federal Reserve and the intensification of the energy crisis in Europe, the RMB responds to the pressure from the strong US dollar in a more flexible way. In the short term, the RMB exchange rate is under pressure at different stages, but does not have the conditions for a trend of significant depreciation.

The latest announcement8According to the monthly bank foreign exchange settlement and sales data, the settlement rate used to measure the willingness to settle foreign exchange is71%Compared to the monthly average since the beginning of this year3Percentage points, the selling rate used to measure the willingness to sell foreign exchange is67%, which is basically consistent with the monthly average since the beginning of this year.

Wen Bin believes that the above data, on the one hand, reflects the strong willingness of market entities to settle foreign exchange at the current RMB exchange rate point, which will become an important market support force for the RMB exchange rate; At the same time, it also reflects that market entities exhibit a trading mode of "settling foreign exchange at high prices and buying foreign exchange at low prices", and the overall trading order in the foreign exchange market is good.

Wen Bin emphasized that from the perspective of China's economic fundamentals, it is expected that the third quarterGDPThe growth rate has significantly rebounded compared to the second quarter, and the inflation level is moderate and controllable. The international balance of payments is in good condition, especially the basic balance of payments items such as current accounts and direct investment, which maintain a high surplus. This has laid the foundation for the stability of the RMB exchange rate and the smooth operation of the foreign exchange market. There is no foundation for sustained depreciation of the RMB.

Zhou Maohua said that in terms of domestic fundamentals, balance of payments, RMB exchange rate flexibility, long-term allocation value of RMB assets and other aspects, the RMB does not have a basis for trend depreciation. Despite changes in the overseas macro environment and intense market fluctuations, the RMB will continue to operate within a reasonable range and normalize two-way fluctuations. Meanwhile, with the gradual digestion of risk factors by the RMB, the domestic economy is steadily recovering, and the international balance of payments is basically balanced, the outlook for the RMB's trend is optimistic.

Chang Ran, a senior researcher at the Zhixin Investment Research Institute, believes that in regulating the excessive appreciation and depreciation of the RMB, monetary authorities have sufficient management tools, including but not limited to activating the countercyclical factor of the central parity rate, adjusting the foreign exchange reserve ratio of financial institutions, adjusting the foreign exchange risk reserve ratio, issuing offshore central bank bills, and adjusting macro prudential adjustment parameters for cross-border financing of enterprises.

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