RMB exchange rate limit for two consecutive days, said the experts back to normal
In the fifth on the U.S. strategic economic dialogue with China on the eve of the RMB against the U.S. dollar exchange rate movements limit two days in a row. Experts believe that the renminbi is back to normal, although the market is the existence of the devaluation of the yuan speculation, but do not see a U-turn onto the devaluation of the renminbi has been on the road. Dec. 4-5, the fifth China-US Strategic Economic Dialogue will be held in Beijing. December 1, the People's Bank of China on the yuan to U.S. dollar exchange rate is set to 6.8505 to 1 over the previous trading day down 156 basis points, or 0.23 percent. Later in the trading session, the RMB exchange rate fell 0.5 percent, the central bank touched the provisions of the Price Limits. Bank of provisions in a single day of the RMB exchange rate fluctuations of no more than 0.5 percent of the U.S.. Yesterday morning, the U.S. central bank also pull back, determined to be 6.8527. Later in the trading session, the yuan fell to reproduce the trend and was 0.5 percent hit the bottom line. At present, the market's expectations for a strong devaluation of the Renminbi. Half a month ago, the central bank governor Zhou Xiaochuan said, did not rule out the adoption of the devaluation of the yuan to promote exports. Morgan Stanley chief economist for Greater China Wang Statistics found that from July 2005 to exchange, the central bank issued a total of 14 quarter monetary policy implementation report, the latest addition to a report of the other phases are Paragraph or two on the RMB exchange rate policy, repeatedly stressed that "initiative, controllability and gradual progress" and "a reasonable and balanced level basically stable" in principle. However, the latest release of the third quarter of this year's report, the wording does not appear that this market speculation that the central bank may change the exchange rate policy. Chinese Academy of Social Sciences, director of finance and trade by Hong Chang Pei said yesterday that the international financial crisis, in July this year, mainly Western countries, changes in currency exchange rates, the euro and the depreciation of the U.S. dollar. RMB exchange rate determined with reference to a basket of currencies, the exchange rate against the U.S. dollar appears to adjust fully to normal Moreover, the exchange rate of RMB against the U.S. dollar has appreciated by 20%, callback is a normal phenomenon. Devaluation of the yuan will help China's exports, but China International Finance Corporation study released yesterday reported that the substantial depreciation of the renminbi will not. First of all, China's trade surplus remained high, the substantial depreciation of the renminbi will encourage trading partners of protectionist sentiment; Second, the substantial depreciation of the yuan could cause a massive outflow of funds in the territory.