The central bank once again raised the foreign exchange deposit reserve ratio to help ease the pressure of RMB appreciation | Deposit reserve ratio_Sina Finance

Original title: The central bank once again raised the foreign exchange deposit reserve ratio to help ease the pressure on RMB appreciation. Source: China Business Network

Our reporter Tan Zhijuan reports from Beijing

The central bank raised the foreign exchange deposit reserve ratio again a few days ago, which aroused market attention: On the evening of December 9th, the central bank issued an announcement stating that in order to strengthen the management of foreign exchange liquidity of financial institutions, it will raise the foreign exchange deposit reserve ratio of financial institutions from December 15 onwards2 That is, the foreign exchange deposit reserve ratio will be increased from the current 7% to 9%.

A reporter from China Business Daily noted that this is the second time the central bank has raised this key interest rate this year. As early as May 31 this year, the Central Bank announced that starting from June 15th, it will raise the foreign exchange deposit reserve ratio of financial institutions by 2 percentage points and increase the foreign exchange deposit reserve ratio to 7%.

According to industry estimates, based on an estimate of US$1.02 trillion in foreign exchange deposits in financial institutions at the end of November this year, this adjustment can lock up to US$20.4 billion in domestic foreign exchange liquidity.

On this,Bank of ChinaWang Youxin, a senior researcher of the Institute, analyzed in an interview with a reporter from China Business News on December 10: “Foreign exchange deposit reserve ratio is an important macro-prudential policy tool. Resolve. Raising the foreign exchange deposit reserve ratio will freeze part of foreign exchange liquidity, push up domestic and foreign currency interest rates, narrow the spread between the RMB and foreign currencies, partially reduce the demand for foreign exchange settlement, and curb the pressure of RMB appreciation.”

Reduce the pressure of RMB appreciation

“The current adjustment is mainly due to the relatively strong performance of the renminbi recently. Although the U.S. dollar is appreciating, the renminbi is also appreciating. my country’s economic growth is still facing certain pressures. In order to avoid the impact of rapid appreciation on exports and the formation of unilateral appreciation expectations, adjust at this time The foreign exchange deposit reserve ratio is conducive to stabilizing the exchange rate trend and better serving the development of the physical sector. In addition, the current global liquidity is surplus and domestic foreign exchange is relatively abundant. A timely increase in the foreign exchange deposit reserve ratio is conducive to improving foreign exchange supply and demand and pushing up foreign exchange. Exchange rate against RMB.” Wang Youxin told reporters about the reason for the increase in the foreign exchange deposit reserve ratio.

The renminbi exchange rate recently broke through the 6.36 resistance level, reaching a strong position at a new high in the past three and a half years. Therefore, in the view of the industry, raising the foreign exchange deposit reserve ratio will help ease the pressure on the appreciation of the renminbi.

In fact, on the evening of December 9th, after the central bank announced the news of raising the foreign exchange deposit reserve ratio of financial institutions, both offshore and onshore RMB fell. Subsequently, on December 10, the central parity of RMB against the US dollar was quoted at 6.3702, which was also reduced by 204 points.

Zhang Yu, assistant to the director of the Huachuang Securities Research Institute and chief macro analyst, told the reporter of China Business News: “The increase in foreign exchange deposit reserves can achieve the effect of restraining the pressure of RMB appreciation, and the central bank has also raised the foreign exchange deposit reserve ratio three times in history. During the period when the pressure of exchange rate appreciation increased, they played a role in restraining the pressure of exchange rate appreciation.”

ChinaMinsheng BankLead researcher Wen Bin also believes that increasing the foreign exchange deposit reserve ratio is equivalent to tightening the supply and liquidity of the U.S. dollar in the foreign exchange market, thereby reducing the pressure on the appreciation of the renminbi and helping the renminbi to maintain a reasonable and balanced exchange rate against the U.S. dollar. Basically stable.

Zhang Yu also pointed out: “Since this year, the RMB CFETS index has reached the strongest level after the exchange rate reform of 811. Historically, the CFETS index has a desirable range of around 94-95. Every major deviation will bring about policy’correction’, and the current CFETS index Has broken through 100.”

Relevant data shows that as of November 5, the CFETS RMB Index has reached 100.83, which is higher than 100 for three consecutive weeks.

　　CITIC SecuritiesA similar view is also held that raising the foreign exchange deposit reserve ratio will freeze foreign exchange liquidity and inhibit foreign exchange derivation, which will help curb the expectation of unilateral RMB appreciation and release signals to strengthen the management of foreign exchange expectations.

“Currently, the balance of various foreign exchange deposits in my country’s financial institutions is approximately US$1.02 billion. The 2% increase in the foreign exchange deposit reserve ratio will lock in approximately US$20.4 billion, compared with the current spot foreign exchange transaction volume of nearly US$37 billion/day and 900 In terms of total foreign exchange transactions of US$100 million per day, the scale is relatively small, so the central bank adjusted more this time or hoped to correct the expectation of unilateral appreciation of the renminbi.” CITIC Securities said.

On November 18, the eighth working conference of the self-discipline mechanism of the national foreign exchange market emphasized that the current global economic and financial situation is complex and changeable. The monetary policies of the central banks of major economies have begun to adjust. There are many factors affecting the exchange rate. The RMB exchange rate may appreciate in the future. , May also depreciate, two-way fluctuations are the norm, reasonable equilibrium is the goal, and the degree of deviation is proportional to the correction force.

The future renminbi exchange rate is still likely to fluctuate in both directions

According to the reporter’s understanding, generally speaking, when the U.S. dollar appreciates, the renminbi will passively depreciate. However, since September, the RMB exchange rate has deviated significantly from the trend of the U.S. dollar index: the U.S. dollar index rebounded, and the renminbi did not depreciate, but appreciated instead. Statistics show that since September this year, the US dollar index has strengthened by 3.6%. At the same time, benefiting from the continuous release of domestic demand for foreign exchange settlement, the RMB exchange rate against the US dollar rose instead of falling, with a cumulative appreciation of 1.9% since September.

Wang Youxin told reporters: “Since November, under the expectation of the Fed to tighten monetary policy, the U.S. dollar index has risen rapidly. However, the yuan has remained stable during the same period, and even appreciated slightly. This is mainly due to three factors: First, supply overseas. In the context of the continuous deepening of the bottleneck of the chain industry chain, China’s export orders continued to increase, the trade surplus and foreign exchange income remained high, which strongly supported the RMB exchange rate; second, since last year, the RMB’s investment and hedging properties have been continuously highlighted. China’s financial market has become more open, and foreign capital has continued to increase their holdings of RMB bonds and stock assets, especially the emergence of new mutant virus strains overseas, which has increased risk aversion in the market and the RMB has become more popular; third, overseas inflation is high, while my country’s inflation Keeping it at a low level will also boost the renminbi to a certain extent from the perspective of purchasing power parity.”

However, excessive unilateral appreciation of the renminbi will put pressure on companies. Wen Bin believes that: “In the short term, the rapid unilateral appreciation of the renminbi is likely to have some impacts on my country’s economy and enterprise levels, especially for my country’s small and medium-sized export enterprises, which will bring exchange losses and decline in export competitiveness. Therefore, the current A timely increase in the foreign exchange deposit reserve ratio can reduce the supply and liquidity of the U.S. dollar in the foreign exchange market, reduce the pressure on the appreciation of the renminbi, and promote the stability of the renminbi to the U.S. dollar exchange rate at a reasonable and equilibrium level.”

What is the future trend of the RMB exchange rate?

In this regard, Zhang Yu believes that the RMB exchange rate will be easy to depreciate and difficult to rise. Because China and the United States may deviate from both the economy and the currency in 2022, the GDP growth gap between China and the United States in 2022 may narrow to the smallest since 1989; the monetary level is clearly tightened by the Federal Reserve while the Central Bank of China is stable and slightly loose. Historically, the RMB exchange rate tends to depreciate in this environment.

However, some institutions hold different views.

CITIC Securities predicts that after the increase in foreign exchange deposit reserves, it is expected that the exchange rate of USD against RMB will be adjusted to a certain extent. However, it is currently at the peak of corporate foreign exchange settlement at the end of the year, and the adjustment may be slightly weaker than the previous round. After the adjustment, the subsequent RMB We will still face a situation where two factors of strong exports and a strong US dollar index are contested. There is a high probability that the RMB exchange rate will continue to fluctuate in both directions.

Wang Qing, chief macro analyst at Oriental Jincheng, also holds a similar view. Looking ahead to 2022, this year’s high base may lead to a decline in my country’s export growth next year. The direction of the Fed’s monetary policy tightening is relatively certain, and the domestic monetary policy will continue to adhere to a flexible, precise, reasonable and appropriate tone, and the possibility of a wider margin is not ruled out. Looking at it this way, it is relatively certain that the spread between China and the United States will narrow next year. Therefore, it is unlikely that the renminbi will continue to move out of the unilateral appreciation market, and the pattern of two-way fluctuations will still be maintained.

Regarding the main policy ideas for the next stage, on November 19, the central bank released the third quarter of 2021 China’s Monetary Policy Implementation Report to deepen the reform of exchange rate marketization, enhance the flexibility of the RMB exchange rate, strengthen the management of expectations, and improve the macro-prudence of cross-border financing Manage and guide enterprises and financial institutions to adhere to the concept of “risk neutrality” and maintain the basic stability of the RMB exchange rate at a reasonable and balanced level.

Editor in charge: Wang Shanshan