On the 14th, according to the announcement of the Foreign Exchange Trading Center, the central parity rate of the RMB against the U.S. dollar was raised by 1,008 basis points to 7.0899 yuan, the largest single-day increase since July 23, 2005. Last Friday (11th), the central parity rate of the RMB against the US dollar was raised by 515 basis points.

On the 15th, the central parity rate of RMB exchange the U.S. dollar in the foreign exchange market was quoted at 7.0421 yuan, an increase of 478 basis points from the previous value. So far, the central parity rate of the RMB exchange the US dollar has achieved “three consecutive rises”. At present, the exchange rate of offshore RMB to US dollar is reported at 7.0553, with the lowest reported at 7.0259.

The rapid rise of the RMB exchange rate is mainly affected by two factors:

First, the lower-than-expected U.S. inflation data in October sharply increased market expectations for the Fed’s future interest rate hikes, causing the U.S. dollar index to suffer a sharp correction. The U.S. dollar continued to weaken following the release of U.S. CPI data. The U.S. dollar index hit its biggest one-day drop since 2015 last Thursday. It fell more than 1.7% intraday last Friday, hitting a low of 106.26. The cumulative decline in two days exceeded 3%, the largest since March 2009, that is, in the past 14 years. two-day decline.

The second is that the domestic economy continues to be strong, supporting a strong currency. In November, the Chinese government adopted a number of measures, which made the market more optimistic about the fundamentals of China’s stable economic development, and promoted a significant rebound in the valuation of the RMB exchange rate.

Zhao Qingming, deputy director of the China Foreign Exchange Investment Research Institute, said that the 20 measures to further optimize the prevention and control work will be studied and deployed in the near future, which is conducive to the recovery of the domestic economy. The fundamental factor that determines the exchange rate is still the economic fundamentals. The market’s economic expectations have improved significantly, which has also significantly boosted the exchange rate.