CNY (RMB) 02 (Feb 16 - Dec 24)

Re: CNY (RMB) 02 (Feb 16 - Dec 17)

Postby behappyalways » Sat Jan 13, 2018 11:17 pm

Stable hands

How China won the battle of the yuan

Capital controls, economic strength and a bit of luck go a long way


“THE horse may be out of the proverbial barn.” So wrote Ben Bernanke, a former chairman of the Federal Reserve, in early 2016, arguing that capital controls might be powerless to save China from a run on its currency. He was far from alone at the time.

As cash rushed out of the country, analysts debated whether the yuan would collapse, and some hedge funds bet that day was coming fast. But two years on, the horse is back in the barn: the government’s defence of the yuan has succeeded, in part through tighter capital controls.

The latest evidence was an 11th consecutive monthly increase in foreign-exchange reserves in December. During that time China’s stockpile of official reserves, the world’s biggest, climbed by $142bn, reaching $3.14trn, roughly double the cushion usually regarded as needed to ensure financial stability.

Another sign of China’s success is the yuan itself. At the start of 2017 the consensus of forecasters was that the currency would continue to weaken; it finished the year up by 6% against the dollar.

Investors and analysts were not wrong in viewing Chinese capital controls as porous. Enterprising types had—and have—umpteen ways to sneak money out, from overpaying for imports to smuggling cash across the border in luggage.

But there is a wide spectrum between a fully open and fully closed capital account, and China has showed over the past year that it can tilt towards closure, at least for a time.

Its measures were directed at actors big and small. Under more scrutiny from regulators, China’s overseas acquisitions fell by more than a third, to $140bn last year. Individuals were still permitted to convert up to $50,000 a year, but they faced heavier disclosure burdens. The government is in no hurry to relax these controls: a new, lower ceiling on withdrawals from ATMs abroad went into effect on January 1st.

Also crucial to China’s defence of the yuan was an economic rebound. Housing prices soared and industrial firms’ profits rose by 20% last year on the back of higher commodity prices. Here, Mr Bernanke can claim some vindication: in looking at China’s options in 2016, he had suggested that a fiscal boost would support growth and so help keep cash at home. An unconventional policy mix—investment in low-income housing and closure of excess industrial capacity—did the trick.

China had a stroke of good luck, too. Many had thought that Donald Trump’s presidency would initially add to dollar strength, which might have pulled cash away from China. But America’s political muddle instead weighed on the dollar. Not only did that boost the relative allure of Chinese assets, it also made its foreign-exchange reserves look more valuable in dollar terms, because roughly a third are held in other currencies.

Over the past year, true inflows accounted for just about a third of the rise in China’s reserves; valuation changes explained the rest (see chart). Other Asian economies with hefty foreign-currency reserves, from Japan to Taiwan, reaped similar gains.

As America cuts taxes and raises interest rates, the dollar may soon perk up. But China has less cause for concern than in 2016. Capital controls have reinforced the bolts on its barn door. And with growth holding up, the horse inside is well-fed.

Source: The Economist
血要热 头脑要冷 骨头要硬
behappyalways
Millionaire Boss
 
Posts: 39906
Joined: Wed Oct 15, 2008 4:43 pm

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Wed Jan 17, 2018 7:49 am

not vested

Chart of the day: Looking for a yuan burst

by Nicole Elliott

September’s daily and monthly hammer candles in the onshore yuan chart marked an important interim low, as we pointed out in this column.

Over the summer, volume and observed volatility have increased steadily as investors revise their outlook for the Chinese currency.

The rally from 6.435 per US dollar was interrupted by the National Day holiday, which you can see as five consecutive days with no range.

This week, for the first time in months, we have a candle that has broken above the top of the descending Ichimoku cloud. Helped higher by the bullish moving averages, once the lagging line breaks above first retracement resistance, expect a sudden burst up to 6.70, which is the next resistance.

Source: SCMP

http://www.scmp.com/business/markets/ar ... yuan-burst
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Wed Jan 24, 2018 9:01 am

Europe’s central banks are starting to replace dollar reserves with the yuan

Two-thirds of the world’s $6.9 trillion allocated foreign exchange reserves are held in US dollars.

As of the third quarter of 2017, just over 1% of foreign exchange reserves were held in yuan.

The Chinese yuan hit a two-year high against the U.S. dollar this week, after the German Bundesbank said that it would include the yuan in its reserves for the first time.


Source: Daily Crux

http://thecrux.com/europes-central-bank ... -the-yuan/
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Tue Feb 13, 2018 8:44 am

Chart of the day: Signs of stabilising for yuan

When the People’s Bank of China triggered the devaluation of the yuan back in August 2015, the one-year US dollar-yuan forward premium jumped as high as 4,000 pips later that year.

Over the past 12 months, the yuan has strengthened and taken back nearly all its losses since the devaluation.

Concurrently, the one-year forward premium has narrowed to about 1,100 pips last week. But in the past week, it has retraced back to 1,500 pips.

According to a report by UOB, while it is premature to say this is the end of this round of yuan strength, it is possible that the dollar-yuan exchange rate may be in the process of establishing a bottom at around the 6.30 level.

This level may well be the near-term floor in the pair as the extended Lunar New Year holiday approaches in China, analysts at UOB say.

Source: SCMP

http://www.scmp.com/business/banking-fi ... ising-yuan
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby behappyalways » Thu Jun 28, 2018 5:37 pm

血要热 头脑要冷 骨头要硬
behappyalways
Millionaire Boss
 
Posts: 39906
Joined: Wed Oct 15, 2008 4:43 pm

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby behappyalways » Tue Jul 03, 2018 4:15 pm

China's yuan continues to fall, sparking comparisons to 2015 rout
https://www.cnbc.com/2018/07/03/chinas- ... cerns.html
血要热 头脑要冷 骨头要硬
behappyalways
Millionaire Boss
 
Posts: 39906
Joined: Wed Oct 15, 2008 4:43 pm

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby behappyalways » Fri Jul 20, 2018 3:24 pm

China's yuan plunges again. Is a currency war coming?
https://money.cnn.com/2018/07/19/news/e ... index.html
血要热 头脑要冷 骨头要硬
behappyalways
Millionaire Boss
 
Posts: 39906
Joined: Wed Oct 15, 2008 4:43 pm

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Sun Sep 23, 2018 9:10 am

Hongkongers may soon be able to open mainland China bank accounts remotely

Talks between officials now focused on sorting out differences in the two regulatory systems involved, and the flow of funds between accounts on either side

[quote]
Initially customers are likely to be able to move small amounts of cash, using e-wallets provided by such operators as Alipay or WeChat Pay.

“We may implement these projects in the Greater Bay Area first,” he said but did not give any timelines.

The Greater Bay area refers to the joint economic cluster of 11 cities in southern China, including Macau and Hong Kong.

It should be noted US$130 billion in capital has flowed into Hong Kong since 2008, and the outflow has been around 10 per cent of that value, so Hong Kong’s banking system is still very liquid.”
/quote]

Source: SCMP

https://www.scmp.com/business/banking-f ... k-accounts
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Mon Oct 01, 2018 7:29 am

China bill sales will boost yuan by expanding investment options in Hong Kong

Central bank move to sell short-term securities in the city may signal start of separate monetary policy for the offshore market

In the same vein, the PBOC has the flexibility to redeem its bills on maturity instead of rolling them over, resulting in a money injection back into China’s financial system to boost economic growth.


Source: SCMP

https://www.scmp.com/business/banking-f ... investment
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

Re: CNY (RMB) 02 (Feb 16 - Dec 18)

Postby winston » Tue Oct 02, 2018 5:37 pm

'Possible' for Chinese yuan to fall another 10 percent if trade war escalates, economist says

Source: CNBC

https://www.cnbc.com/2018/09/28/economi ... lower.html
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118518
Joined: Wed May 07, 2008 9:28 am

PreviousNext

Return to Currencies

Who is online

Users browsing this forum: No registered users and 1 guest

cron