On December 20, the central parity rate of RMB against the US dollar was 6.9861, a depreciation of 115 basis points. The middle price of the previous trading day was at 6.9746, the closing price of onshore RMB was at 6.9747 at 16:30, and at 6.9818 at 23:30.
The U.S. dollar index rose slightly on the 19th. The U.S. dollar index, which measures the U.S. dollar against six major currencies, rose 0.03% on the day and closed at 104.7320 at the end of the foreign exchange market.
The People’s Bank of China authorized the National Interbank Funding Center to announce that the loan market quotation rate (LPR) on December 20, 2022 is: 1-year LPR is 3.65% (the last time was 3.65%), and the 5-year LPR is 4.3% (4.3% last time).
The central bank carried out 5 billion yuan 7-day and 141 billion yuan 14-day reverse repurchase operations in the open market, and the winning bid rates were 2.0% and 2.15%, respectively. According to Wind data, 2 billion yuan of reverse repurchases expired today.
Zhou Maohua, a macro researcher at the Financial Market Department of China Everbright Bank, pointed out that fluctuations in the RMB exchange rate are mainly disturbed by the US dollar and market expectations of economic recovery prospects. The Fed’s December meeting was hawkish, but the rate hike is coming to an end and the pace of rate hikes has slowed down. The market is cautious about the trend of the US dollar. At the same time, my country’s economy continued to recover, and the market became more optimistic about the prospect of economic recovery, which caused two-way fluctuations in the RMB exchange rate.