The foreign exchange deposit reserve rate has been reduced again within the year, which affects the market?Institutional interpretation

Zhongxin Jingwei, September 5th. In the afternoon of the 5th, the Central Bank announced that starting from September 15, 2022, the reserve ratio of foreign exchange deposits of financial institutions has been reduced by 2 percentage points, that is, the foreign exchange deposit reserve ratio has been reduced from the current 8%to 6 %. This is also the second time that the central bank has reduced the foreign exchange deposit reserve ratio after the central bank reduced the foreign exchange deposit reserve ratio of financial institutions on April 25 this year.

Picture source: central bank website

Since mid -August, the RMB exchange rate has gone through a round of rapid callback. On September 5th, the price of the RMB against the US dollar at 16:30 was reported at 6.9366 yuan, a 338 basis point from the previous trading day. The offshore RMB that reflects the expectations of international investors has also weakened on September 5, and the market has fallen below the 6.93, 6.94 and 6.95 marks in a row, continuing to set a new low since August 2020.

However, at 17:00 Beijing time, after the central bank announced the reduction of foreign exchange deposit reserve ratios, the offshore RMB rose nearly 200 basis points against the US dollar.

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It is understood that the foreign exchange deposit reserve ratio refers to the ratio of foreign exchange deposits reserve to the central bank to the central bank and its absorption of foreign exchange deposits. It is also one of the important tools for the central bank to regulate the supply and demand of foreign exchange markets. The reduction of foreign exchange deposit reserve rates can release foreign currency liquidity, thereby reaching the expectation of unilateral devaluation of the RMB exchange rate to a certain extent.

Liu Guoqiang, deputy governor of the People's Bank of China, pointed out at a routine briefing of the State Council's policy on the 5th that the long -term trend of the RMB should be clear. The future world's recognition of the RMB will continue to increase, which is a long -term trend.

Liu Guoqiang also said that the RMB exchange rate will be affected by various factors. Recently, it is mainly the adjustment of the United States to increase the currency policy. In this case, the US dollar has appreciated by 14.6%since this year. In the context of the appreciation of the US dollar, other reserves currency in the SDR basket are all on the US dollar. The depreciation of the renminbi has also been depreciated by about 8%, but compared with other non -US dollars, the depreciation is the smallest.

So, what impact does the foreign exchange deposit reserve rate be reduced within the year?

"Decreased foreign exchange deposits reserve means a reduction in reserves paid by domestic financial institutions for foreign exchange deposits, helping to increase the liquidity of the US dollar in the market, and enhance the ability of foreign exchange funds to use financial institutions. Wen Bin, chief economist of the bank, said that due to the current Federal Reserve ’s accelerated tightening of monetary policy, the US dollar index once broke through the 110 mark, causing the passive depreciation of the RMB to the US dollar. The central bank's move to release a positive signal to the market is conducive to stabilizing RMB exchange rate expectations and avoiding irrational overruns.

"On August 15th, the central bank lowered the interim borrowing convenience and the loan market quotation interest rate LPR, which showed that my country's monetary policy still maintained the rhythm of me. Yang Delong, chief economist of Qianhai Open Source Fund, said that recently, due to the continuous soaring in the US dollar index, it has continued to adjust non -US currency, especially in some developing countries currency depreciation.

"In terms of the capital market, the northbound funds bought 7.9 billion yuan throughout the day, and a total of 12.7 billion yuan was increased in August, indicating that foreign capital's attitude towards the current A -share market is not affected by the depreciation of the renminbi." Yang Delong said that the short -term exchange rate fluctuations fluctuate The impact is limited, and Chinese assets still have a large investment attractiveness to foreign capital.

Yang Delong said that the impact of short -term exchange rate fluctuations is limited, and Chinese assets still have relatively large investment attractiveness to foreign capital. A number of foreign investment banks issued a report saying that investors can regard the recent low valuations of the Chinese stock market as an opportunity to further increase their warehouses, optimistic about the performance of the stock market after the economic recovery, and the valuation of the Chinese stock market is more attractive.

In addition, Yang Delong also said that the expected exchange rate is expected to maintain the RMB exchange rate to maintain basic stability at a reasonable balance level. Generally speaking, the short -term depreciation of the RMB exchange rate is conducive to stimulating exports. As long as the renminbi exchange rate maintains the interval to fluctuate, it should not have a great impact on the economic recovery.

Dong Ximiao, chief researcher at Zhailian Financial, said that the reserves of foreign exchange deposits reserved to release foreign exchange liquidity to the market, increased market foreign exchange supply, thereby further suppressing foreign exchange appreciation and alleviating the pressure of RMB depreciation.

"During the twice a year, the foreign exchange deposit reserve ratio is transferred to the market to convey a clear policy signal to the market, which helps stabilize market confidence and expectations, and promote the renminbi exchange rate to reduce fluctuations and return to normal." Economic fundamentals support the RMB exchange rate at a reasonable and balanced level.

Wang Qing, chief macro analyst of Dongfang Jincheng, also believes that the reduction of foreign exchange deposit reserve rates will increase the liquidity of the US dollar in the shore market, and alleviate the depreciation pressure of the RMB against the US dollar in the existing exchange market supply and demand balance.

"However, the depreciation of this round of RMB is mainly triggered by the US dollar index, and the three major RMB exchange rate index runs steadily. This means that the regulatory market regulation will be mild in the next regulatory market. As the US dollar index fluctuates reverse. "Wang Qing said that the depreciation of the RMB against the US dollar will tend to mild the next step, and a basket of exchange rate index will continue to be strong. (Zhongxin Jingwei APP)

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