RMB Against USD Continued To Hit 2 Month Low

The yuan narrowed against the US dollar on Wednesday (December 3rd), hitting a 2 month low.

Under the guidance of the central parity again callback of 51 points, the cash exchange once touched a low of 6.1531 yuan against 1 dollars.

The US dollar / RMB inquiry system was reported at 6.1500 noon and 6.1503 on Tuesday.

The central parity of US dollar / RMB central bank was 6.1376, and Tuesday's middle price was 6.1325.

In the overseas non deliverable forward foreign exchange (NDF) market, the US dollar / Renminbi one year variety is newly reported at 6.2670/90, ending on Tuesday at 6.2615.

The latest offshore dollar / RMB spot report in Hongkong was 6.1517/41, and the last trading day was 6.1559.

Traders said the purchase of foreign exchange was still strong, but overall supply and demand were relatively balanced and volatile.

Because the cost of holding US dollar long positions is too high, investors are also cautious about shorting the renminbi.

"Because of the tight funds in the local currency, the premium of the US dollar in the short end of the swap is higher, and the holding cost of the long position is a deterrent to the banks."

Traders added that this also makes the recent US dollar long trading mostly confined to the day rather than holding overnight positions.

In the short term, the RMB exchange rate may continue to derogate. It is necessary to note that if we break through the key technical position, we may let the long - term US dollar go in, which will lead to the rapid depreciation of the RMB.

Global

In terms of USD / yen week, Sanya hit a 7 year high in the session, because the yield of US Treasury bonds rose and FED officials' comments on the US economic outlook were mostly optimistic.

Jim Rogers, an investment giant, said at a meeting of Chinese investment institutions that he had been optimistic about the renminbi and hoped to buy more yuan in.

He said that the US dollar is the world's reserve currency and the main settlement currency, but the dollar itself is flawed.

Now it is the biggest debt country in the world, and this situation has great risks.

Therefore, in the long run, there is an urgent need for a currency to compete with the dollar and even to replace it in the long run.

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Rodgers said, "the Shanghai free trade zone has created the conditions for the RMB to go all the way to the world."

The Shanghai free trade zone has opened the Renminbi for free convertibility.

When the renminbi can be fully opened one day and become one of the major settlement currencies in the world, it may become a world currency instead of the US dollar. "I have always held RMB and RMB assets. I think the trend of RMB will fluctuate after the opening of the FTA, but the trend of rising is not going to change."