RMB Appreciation Is Faster And Dollar Depreciation Is Faster.

The official exchange rate of RMB against the US dollar entered the "6.4" era.

Yuan to us dollar released yesterday from China Foreign Exchange Trading Center

Or preheating the strategic dialogue between China and the United States

In anticipation of the increasing appreciation of RMB, the dollar selling pressure in the market was heavy yesterday.

Yesterday's Beijing time 9:53, the yuan inquiry was 6.4939 yuan, the closing price of the day was 6.5015 yuan, and hit the new high of 6.4935 yuan since 2005.

US Senator Schumer said on Thursday that he is "more convinced" that it is necessary to pass legislation to force China to raise the exchange rate of RMB against the US dollar.

Zhou Xiaochuan, governor of the people's Bank of China, recently stressed the need to enhance the flexibility of financial macro-control and monetary policy.

As the Federal Reserve Committee said the current quantitative easing policy had not changed, and fed chairman Bernanke was cautious, the dollar index continued to run low in the international market.

Analysts say the current US interest rate level is relatively low, the economic growth is slow and the federal budget deficit is huge. These factors suppress the US dollar trend, and it is expected that the dollar will not improve before the end of the quantitative easing policy.

Traders think the dim dollar outlook, the Sino US talks are coming and China.

The accelerated appreciation of the RMB exchange rate is on the eve of the third round of strategic and economic dialogue between China and the United States (S&; ED).

The industry believes that the current appreciation of the renminbi accelerates the goal of creating a good atmosphere on the eve of strategic talks.

Peng Cheng, a Chinese economist at Citigroup, said the same scenario also appeared during the visit of former president Hu Jintao to the United States, but believed that the speed of appreciation of the renminbi would slow down after the end of the Sino US strategic and economic dialogue.

According to the established plan, the third round of China US strategic and economic dialogue will be held from May 9th to 10 in the US China (market, information, commentary), and the issue of RMB will again become the focus of debate.

{page_break}

RMB appreciation or over 6% this year.

"The renminbi has risen rapidly, but the US dollar has been derogated."

Societe Generale (601166) senior economist Lu political commissar yesterday pointed out that such a change in the RMB exchange rate may be related to two main reasons: first, the continued depreciation of the international dollar, and the US dollar index has dropped from about 76 in the early April to about 73 now, which has led to a significant appreciation of the currencies of the major emerging markets in the world. Secondly, exports have probably returned to a relatively strong level. According to the forecast, the export growth rate has risen to a high level of 29.2% in April, which eliminates the worries of RMB appreciation in the short term.

Lu political commissar believes that, regardless of the impact on exports or price, the effective exchange rate index changes are more obvious than the RMB to us dollar exchange rate effect.

Therefore, even though the current appreciation of the RMB against the US dollar is fast, its overall impact on exports is still controllable, and its inhibiting effect on inflation is also very limited.

Xia Bin, member of the monetary policy committee of the people's Bank of China, said on his micro-blog that in the long run, gradual appreciation is necessary. In terms of specific operation, the floating range of exchange rate should be expanded, and the situation of one-time appreciation will not be ruled out.

Huang Yiping, Professor of the National Development Research Institute of Peking University, pointed out that in 2011, the appreciation must exceed last year. He judged that "the appreciation of RMB against the US dollar will exceed 6% this year."

The latest report of the ANZ bank predicts that by the end of June, the yuan will rise to 6.43 against the US dollar.

It is obvious that in the offshore market, the RMB has already traded on the 6.48 front line against the US dollar, and the one year NDF has dropped to the 6.32 line again, which means that the market expects the RMB to appreciate nearly 3 percentage points in one year.

Easing domestic inflation pressure

Some economists also pointed out that the recent worsening of inflation in China is also an important reason for betting that the renminbi will appreciate faster.

Obviously, the consumer price index (CPI) of China's residents increased by 5.4% in March.

High energy and commodity prices push up production costs, and the pressure on rising prices of downstream consumer goods has increased significantly.

The monetary authorities frequently tightened policies through quantitative tools, and the effect remains to be seen.

Recently, the macroeconomic management department of the government has interviewed various key enterprises in various industries, trying to control the pressure of rising prices in a certain range.

Shenyang Wanguo (quotes, information, commentary) securities chief macroeconomic analyst Li Huiyong released in April 28th report predicted that in April some of the price of food fell somewhat, but taking into account the acceleration of non food prices rising trend, CPI growth in April will still be over 5%.

Inflation pressures in the two quarter will not be much lower than in the first quarter.

The latest study released by the world bank and the International Monetary Fund (IMF) also makes recommendations on China's policy on inflation, all of which include exchange rates.

Han Weisen, chief economist of the world bank's China Representative Office, said that appreciation of the renminbi is an effective tool to curb inflation.

"Appreciation can reduce domestic inflationary pressure, but it can only play an auxiliary role."

Cui Li, chief Chinese economist at the Royal Bank of Scotland, believes that although appreciation can reduce import prices, the current domestic inflationary pressure is more from structural and long-term internal factors.

"Before the external environment has improved, the policy is still stimulating domestic demand, and policies such as stimulating investment and consumption will create pressure on inflation itself."

Cui Li said.