Central Bank report: Expand RMB in foreign trade investment

Zhongxin Jingwei, September 23rd, the central bank website released the "RMB International Report 2022" (hereinafter referred to as the "Report") on the 23rd. It is clear that the next stage will expand the use of RMB in foreign trade investment; further facilitate foreign investors to enter Investment in the Chinese market, enrich the types of assets that are available.

The overall stability of the offshore RMB interest rate

According to the "Report", since 2021, the interest rate of the offshore RMB has been stable, the differentiation of each period has become significant, the fluctuation of the overnight interest rate has further increased, and the long -term interest rate is generally stable.

Data show that at the end of 2021, the Hong Kong Bank's interbank RMB borrowing interest rate (HIBOR) overnight and 7 -day borrowing interest rates were 6.93%and 2.57%, respectively, an increase of 290 basis points and 39 basis points from the end of the previous year. The 6 -month and 1 -year interest rates were 2.99%, 3.07%, and 3.16%, respectively, up 10, 13 and 9 basis points from the end of 2020.

In 2021, the level of offshore market interest rates were higher than the shore market. Hibor was 0.45 percentage points higher than the SHIBOR interest rate (Shibor) in Shanghai. The spreads of Hibor and Shibor from one month and 3 months were relaxed from 30 and 31 basis points in the first half of the year to 70 and 71 basis points in the second half of the year.

The "Report" also mentioned that in 2021, the two -way fluctuation characteristics of the offshore RMB exchange rate were obvious, which was basically consistent with the trend of the RMB exchange rate on the shore, and the offshore and shore exchange difference was generally stable.

Data show that in the first half of 2021, the exchange rate of the offshore RMB rose as a whole, with a maximum of 6.36; in the second half of the year, the inter -offshore RMB exchange rate was stable and closed at 6.36 at the end of the year, an appreciation of 2.2%over the end of the previous year.

In addition, the number of days stronger than the offshore RMB exchange rate during the year of the exchange rate of the offshore RMB is roughly equivalent to the trading day of the RMB exchange rate. The average daily exchange of offshore on the shore throughout the year was 64 basis points, which was reduced by 50 basis points from 2020.

Promote the virtuous cycle of the RMB on the shore and offshore market

For the next stage of prospects, the "Report" mentioned four aspects: First, expand the use of RMB in foreign trade investment. In recent years, the demand for endogenous demand for market entities to use RMB in cross -border trade investment to reduce risk of currency mismatch has risen. In order to better meet market demand, it is necessary to continue to do system design, policy support and market cultivation, strengthen the coordination of domestic and foreign currency, and support market entities to use more RMB in foreign trade investment.

At the same time, further promote the pilot piloting of the domestic and foreign currency integration capital pools of multinational companies. Focusing on the construction of the free trade pilot zone (free trade port), the Guangdong -Hong Kong -Macao Greater Bay Area and the Shanghai International Financial Center, promote the innovation of RMB cross -border investment and financing business, and continuously enhance the willingness to use RMB in trade investment in trade investment.

The second is to steadily promote the two -way financial market. Promote the open transformation of the financial market to a comprehensive system, and improve the liquidity of RMB financial assets. Further facilitate foreign investors to invest in the Chinese market, enrich the types of assets that can be investable, and facilitate foreign investors, especially central bank institutions to allocate more RMB assets. Support overseas entities to issue "Panda Bonds", and continue to do a good job of pilot work of the "Cross -border Financial Management" of the Guangdong -Hong Kong -Macao Greater Bay Area.

The third is to continue to deepen central bank monetary finance cooperation. Continue to steadily promote the bilateral bilateral currency exchange and local currency settlement cooperation between the central banks, give full play to the role of currency swaps in supporting the development of the offshore RMB market and promoting the facilitation of trade and investment, and explore LCS cooperation with other ASEAN countries and neighboring countries. Promote the direct transactions of the RMB to related countries, and support the development of the local RMB foreign exchange market for foreign countries and regions.

The fourth is to support the healthy and orderly development of the offshore RMB market. Give full play to the role of the exchange arrangement with Hong Kong's standing currency swap, and provide long -term stable RMB liquidity for the Hong Kong RMB market. Continue to improve the liquidity supply mechanism of offshore RMB, stimulate the power of market entities to innovate and develop offshore RMB market products and services, enrich the offshore RMB product system, and promote the formation of a virtuous cycle of RMB in the shore and offshore markets. Optimize the layout of the RMB liquidation bank, strengthen policy support for liquidation banks, and give full play to the positive role of liquidation banks to cultivate the offshore RMB market. (Zhongxin Jingwei APP)

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