After the USD index broke through 107, the offshore RMB returned to 7.25. The central bank once again mentioned exchange rate flexibility, with tolerance for volatility possibly increasing.
① The US dollar index rose and broke through the key level of 107. The offshore renminbi against the US dollar once again reached the 7.25 level, last time was at the end of July. ② The head of the International Department of the People's Bank of China stated that he insists on the decisive role of the market in the formation of exchange rates, maintains the flexibility of exchange rates, and strengthens expectation guidance. The tolerance of management for fluctuations in the renminbi exchange rate may be increasing. The market generally believes that 7.30 is the recent resistance level.
The People's Bank of China International Department: The RMB exchange rate will remain fundamentally stable at a reasonable and balanced level.
On November 22, China's People's Bank International Division head Liu Ye stated at the State Council's regular policy briefing at the Information Office that the factors affecting exchange rates are diverse, and the future renminbi exchange rate may maintain a trend of two-way fluctuations.
PBOC Leaves Loan Prime Rates Unchanged in November
The central bank today conducted a 981 billion yuan reverse repurchase operation for 7 days, with short-term fluctuations in liquidity being controllable, and the market expects a possible reserve requirement ratio cut in November.
①Today, 12.2 billion yuan reverse repos will mature, in addition to 1450 billion yuan MLF and 80 billion yuan of treasury cash deposits maturing. The central bank conducted a 981 billion yuan 7-day reverse repo operation. Industry insiders believe that under the new framework of the central bank, there may be a reserve requirement ratio cut once this year, possibly as early as November.
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