Offshore RMB against the US dollar quickly fell, short-term break below the 6.89 mark, is now reported at 6.8954, reversing more than 400 points. Earlier, the offshore RMB against the US dollar once rose above the 6.86 mark, up nearly 600 points.
The central parity of the RMB against the US dollar rose 299 points to 6.9371 today, and the median price rose to its highest level since October 24, 2018. The increase was the largest since August 28, 2018.
Hong Wei, managing director of Bank of Communications International, believes that although the RMB exchange rate has been under pressure recently, a series of important speeches and measures have stabilized the stock market. The exchange rate is similar, and 7 should be the short-term policy bottom line.
The chief fixed income analyst of CITIC Securities clearly stated that the issuance of offshore central bank bills can effectively manage exchange rate movements. From the point of view of the difference between offshore and onshore renminbi, the offshore renminbi exchange rate in late August is stronger than the onshore renminbi exchange rate. The central bank mainly uses the various exchange rate instruments to effectively communicate the exchange rate signal to the market, and the sensitivity of the offshore renminbi exchange rate. The sex is higher, so the offshore RMB exchange rate is stronger. With the resumption of the countercyclical factor by the central bank on August 24, the central parity of the renminbi against the US dollar was also significantly stronger, driving the onshore renminbi exchange rate stronger than the offshore renminbi exchange rate. Since the countercyclical factor mainly affects the onshore exchange rate, the central bank will further strengthen the impact on the offshore RMB exchange rate through offshore central bank bills.
Xie Yaxuan, director of macro research at China Merchants Securities, said that under the background of the Fed’s interest rate hike cycle, the stability of exchange rate demand has significantly weakened the monetary policy constraints, and the Sino-US spread has narrowed to a lower level. If the exchange rate fluctuates significantly, it is obviously not conducive to the domestic economy. As well as the stability of the capital market, it is reasonable for the central bank to directly intervene in the stable foreign exchange market.