4 days depreciation nearly 1400 points! The rapid depreciation of the RMB is only a test for the time being?Experts Dispel Doubts

As of the close on Friday (April 22), the RMB against the US dollar broke through the 6.5 mark, with USD/offshore RMB and USD/onshore RMB reported at 6.5274 and 6.5017 respectively, and the accumulated depreciation from last Tuesday to Friday was nearly 1500 points and 1400 points. , depreciated by nearly 2%, hitting its lowest point since November 2021, and its weekly decline was also the largest since August 2019. On Friday, the onshore renminbi fell 500 points, more than the offshore renminbi.

according toFirst FinancialAccording to the report, a number of traders and strategists of Chinese and foreign banks told reporters that, unlike in the past, the central parity rate of the renminbi has fluctuated greatly in the past week. The market was shocked, and offshore traders seemed to have seen the signal, and the yuan depreciated quickly. “The central parity has always been relatively stable, and the recent night trading has fluctuated wildly. The central bank may intend to bring the central parity closer to the spot transaction price.”

However, the bears may be only tentative in the near term. Given that the RMB has been stable in the 6.3 range for a long time, fluctuations in the recent external interest rate hikes and domestic epidemics are still to be expected. The International Monetary Fund (IMF) has repeatedly mentioned that a flexible exchange rate will be an economic shock. “buffer”.

“The recent weakening of the renminbi is understandable, and it has come later than expected. But it is unlikely that the renminbi will continue to weaken significantly, and it is reasonable to stay above 6.5 for some time.” Ulrich Leuchtmann told reporters.

Currently in the intensive release period of the first quarterly report, some manufacturing growth leaders have slowed down or failed to meet expectations, which may lead to a decline in stock prices and suppress the overall performance of A-shares. Shanghai Investment Morgan mentioned to reporters that as of April 18, a total of 529 A-share companies had announced their first-quarter performance forecasts. Among them, there are 350 pre-increase companies and 32 pre-profit companies, and the proportion of companies with pre-existing performance is 72.21%.

butIn the face of rising commodity prices and rising costs in the first quarter, as well as the repeated negative impact of the epidemic on production and operations, the first quarterly report that has been disclosed may not reflect the full picture. Enterprises may be more disturbed by the epidemic in the second quarter, and the fundamentals of business operations are expected to be more challenged than in the first quarter. However, considering that the current overall market valuation has returned to a historically low position, the market still contains opportunities in the medium and long term.

In addition, the Fed is likely to announce a 50 basis point interest rate hike in early May, and it does not rule out announcing a roadmap to shrink its balance sheet. The Fed expects that the monthly shrinking of its balance sheet will eventually reach $95 billion. How this will disturb the global market is still worthwhile focus on.

Hashtags: RMB economic experts