28 Sep 2015
Chinese keeping depreciation expectations in check - UOB
FXStreet (Guatemala) - Analysts at UOB Group explained that the Chinese authorities continue to be on a “mission” to keep depreciation expectations in check nearly 2 months after the 11 August move to adjust the central parity mechanism.
Key Quotes:
"The latest came from China President Xi Jinping who spoke in the state visit to the US last week that China will not devalue the RMB to boost exports and there’s no basis for depreciation. Onshore RMB came off 0.16% for the week to close at 6.3744/USD on Friday, despite a gain of 0.13% for the day. In a sign that the onshore market has calmed down somewhat, the gap with the midpoint has narrowed to 30- 40 points recently. Friday’s fixing of 6.3785/USD was little changed from the previous day."
"In the offshore CNH market, the unit rose 0.47% to 6.3999/USD late Friday, the biggest advance since 10 September when the PBoC was first seen taking the rare step of intervening in the offshore market after the 11 August adjustment. For the week, the CNH is down 0.2%, the most since the second week of August. The onshore-offshore spread has narrowed to 200-300 points in recent days. The PBoC set the USD/CNY central parity at 6.3729."
Key Quotes:
"The latest came from China President Xi Jinping who spoke in the state visit to the US last week that China will not devalue the RMB to boost exports and there’s no basis for depreciation. Onshore RMB came off 0.16% for the week to close at 6.3744/USD on Friday, despite a gain of 0.13% for the day. In a sign that the onshore market has calmed down somewhat, the gap with the midpoint has narrowed to 30- 40 points recently. Friday’s fixing of 6.3785/USD was little changed from the previous day."
"In the offshore CNH market, the unit rose 0.47% to 6.3999/USD late Friday, the biggest advance since 10 September when the PBoC was first seen taking the rare step of intervening in the offshore market after the 11 August adjustment. For the week, the CNH is down 0.2%, the most since the second week of August. The onshore-offshore spread has narrowed to 200-300 points in recent days. The PBoC set the USD/CNY central parity at 6.3729."