Two way fluctuations in the RMB is more obvious

In June the central bank announced that since the resumption of the reform on RMB exchange rate against the U.S. dollar two-way fluctuations present situation, while the real appreciation of the yuan rate to 0.25%. Among them, most of the rise occurred in June, was 0.65%.

Analysts believe that this two-way fluctuations in momentum, reflecting the link between the yuan and the dollar is no longer so close, the yuan has appreciated this year will be more limited, two-way fluctuations in the trend was still evident.

Regular health economist at Barclays Capital in China, said that the RMB yuan against the U.S. dollar trend and two-way fluctuation, with reference to a basket of currencies to increase flexibility of RMB exchange rate policy objectives. "While we still maintain the smooth, steady appreciation of the yuan valid point of view, but also reflects the recent strength of the dollar weakness over the short term in the state." But he still believes that the Government for exports and economic growth prospects even more determined, the appreciation of the RMB against the U.S. dollar the pace will accelerate.

In general, faster yuan appreciation on the profits of export enterprises in China, China's trade surplus and so would have a negative impact. However, experts also pointed out that, in the sharp appreciation of the yuan against the background of profits are affected by export enterprises are mainly concentrated in the more low-end of the processing trade industry, but over the short term Shengzhi not necessarily be labor-intensive processing trade enterprises, profit down the main factor, which is more likely to result in profit margins in manufacturing enterprises, wholesalers and retailers redistributed.

Standard Chartered Bank Financial Markets, Global Sales Director David Carr is expected in the next 12 months, the yuan will continue to appreciate 4.5% appreciation of the process will be gradual, two-way volatility. "The next market will be more volatility. China's export enterprises will surely face exchange rate risk, especially those who are in U.S. dollars, expenditures for the RMB's businesses, they need to find the right financial products Jiandan to avoid risks. On the other hand, the future money market, commodity markets will be more volatility, companies need to get used to avoid risks, it can also encourage China's manufacturing enterprises increased the value chain to make products more valuable, more resistance to exchange rate risks . "David Carr said.

In fact, the June Meeting in late restart to change, shift peg from the dollar peg to a basket of currencies, the market has been interpreted as an important step in the internationalization of RMB is one. Concomitant, also the PBC and its neighboring countries to expand the central bank's currency exchange, increased cross-border trade, RMB pilot, allowing foreign capital into the mainland of China RMB inter-bank bond market and many other initiatives.

A large foreign banks for funds and the Ministry of Trade argue that the RMB account set up with foreign enterprises, to expand investment channels, foreign currency funding back to the Mainland continued to implement such measures, combined with widespread public appreciation of the renminbi is expected to field, offshore holding companies RMB, and the use of the RMB settlement of cross-border trade will be further enhanced, which helps to import and export enterprises will be accounts receivable, accounts payable to match the currency, to avoid foreign exchange risk, reduce costs and foreign exchange management cost risk.

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