China'S Central Bank Intervened Or Led To An Unexpected Strengthening Of The Renminbi.

On Wednesday (July 20th), the central parity of RMB increased by 25 points to 6.6946, or 0.04%. Although the overnight dollar index rose 0.5%, the yuan still strengthened unexpectedly. Some analysts speculated that it might be caused by the intervention of the Central Bank of China.

Tuesday (July 19th)

For the better, the dollar index stood at 97 points, hitting a new high since March 10th, and eventually closed up 0.5%.

"The tone of the US data report is encouraging," Millan Mulraine, a strategist at Dow Ming securities, wrote in the report.

In June, the number of new housing starts increased to 1 million 189 thousand per annum, higher than the expected value of 1 million 165 thousand, while construction permits also increased, suggesting that the recovery will continue, and data show that builders are confident.

Since June 24th

After the result of the referendum, the US dollar continued to strengthen and the renminbi entered a "down and down" state.

On Monday, the central parity of RMB dropped to 6.6971, a new low since October 2010, approaching the 6.7 pass. On Tuesday, the US dollar strengthened again. It is widely expected that the RMB intermediate price announced on Wednesday will fall sharply, and the final result shows that the RMB will not rise and fall. Some analysts speculate that it may be caused by the intervention of the Central Bank of China.

On Wednesday, the offshore renminbi rose rapidly after the opening of the yuan, and it gained 145 points and is now trading at 6.6818.

In the early morning of the Asian market, the offshore renminbi rose strongly, and the intraday rose 148 points, now trading at 6.6957, recovering the 6.7 pass.

Zhou Hao, an analyst with Commerzbank, thinks China

For two consecutive days, the central parity of RMB was stronger than the expected model, indicating that the central bank intends to defend the offshore exchange rate at a key position of 6.7.

Under the current middle price pricing mechanism, when the overnight dollar is strong, the central bank should lower the central parity of RMB, but this will make the market think that the central bank allows the RMB to depreciate and thus short for the shore. Therefore, when the central price is fixed, the central bank may make a trade-off. At present, the central bank does not want to see the depreciation of the RMB.