*** unlikely to depreciate significantly

This year's *** is unlikely to depreciate sharply because the central bank cannot afford to let the market go, especially at the time when the dollar’s ​​strength has appreciated. At the same time, in the process of internationalization, the floating range of exchange rates can only be gradually expanded rather than the “Great Leap Forward”.

The central bank’s exchange rate operations have always been mysterious and uncertain. Recently, Wang Yu, deputy director of the Central Bank Research Bureau, at the “National Research Think Tank Forum New Year’s Forum 2015”, disclosed several pieces of information to the media:

1. The objective of the exchange rate of the city and the DPRK is to establish a "managed and managed" floating exchange rate system based on market supply and demand;

2. The floating range of the exchange rate of *** has been gradually expanded from three thousandths to five thousandths and has now expanded to two percent;

3. The exchange rate of ****** is currently close to equilibrium, because China's current account accounted for a surplus of 2.4% of its GDP in 2013, according to international practice, as long as the value does not exceed 4%, even if the balance of payments is basically balanced.

4. To achieve a more freely floating exchange rate, there is still a long way to go.

Experienced and able to chews a lot of information.

First of all, even if the floating exchange rate system has been reached in the future, it does not mean that it is absolutely free, but it is “managed”. In other words, even if the exchange reform is completed in the future, it does not mean how you want to come. The necessary management cannot be completely abandoned.

Second, this management has preconditions. It is not always controlled. It can only be managed when *** is floating up or floating down too far, which endangers China's financial security. It is usually ignored, and it is left to the market to determine supply and demand. This is equivalent to drawing a range or interval for the float.

Thirdly, the interval is actually the interval, which has always existed regardless of the interval. It was only small in the past. It only had three thousandths. If the volatility exceeds three-thousandths, the central bank will have to manage it. It is now slightly larger, reaching 100%. Second, more than 2%, the central bank will have to manage. The future will be even greater.

Fourth, the smaller the range is, the easier it is for the rate of exchange rate fluctuation to exceed the range, and the more frequent the central bank will be managed. The larger the range, the harder it is for the range of exchange rate fluctuations to exceed the range, and the less the central bank will intervene. Therefore, the process of exchange reform is the process of central bank intervention reduction. In fact, it is the process of increasing the scope of the exchange.

Fifth, in 2014, the central bank suddenly expanded the volatility range of *** to 2%, showing the strength of the exchange reform. But to achieve a managed floating exchange rate system, how much should this interval be achieved? Wang Yu gave two reference numbers: “Chile withdrew from the regular intervention when the currency's floating range reached 12%, and Poland withdrew from the regular intervention when the currency floating range reached 15%.” That is to say, , China's central bank to withdraw from regular intervention, may have to wait until the *** exchange rate fluctuations to a certain extent, such as 12% -15%. From 2% to 15%, the gap is not small, which is why there is still a long way to go before the exchange reform of ***.

Sixth, in the future, even if the central bank withdraws from regular intervention, it may still have a range, but this range is very large, it may be 30%, it may be 50%, after this interval, the central bank still has to manage. For instance, Russia’s big devaluation of the ruble, the Russian central bank has been intervening, and when it is reduced to 64%, it simply declares that transactions beyond this part are invalid.

After understanding the above-mentioned six points, I believe that many people have already made a general judgment about the trend of *** in 2015:

One is the devaluation of the ***. There are currently two major schools of devaluation, and one school is a collapse theory. It is believed that the appreciation of the dollar will result in a currency war. This view is more imaginary than factual observation and can be regarded as a small probability event. The other faction is the theory of salvation of exports, because the dollar has risen considerably against all currencies in the world. If it does not devalue, it will put enormous pressure on exports and the domestic real economy. Therefore, it must be greatly discounted.

However, judging from the current policy of the central bank, the possibility of a large devaluation is very small. At best, it will only enlarge the fluctuating range from the point of exchange reform. For example, in 2015, the fluctuating range of *** will be enlarged to 5 %.

The second is the rapid internationalization of ***. *** To truly become an international currency, free exchange of a floating exchange rate is an essential prerequisite. Yu Yongding, a former member of the monetary policy committee of the Central Bank of China, has been firmly opposed to accelerating the pace of free convertibility. He believes that when the dollar is about to raise interest rates, if the exchange rate is opened, it will be disastrous for China. Although the Central Bank has been stressing that it is necessary to speed up the pace of exchange reforms, it will take quite a long time to actually complete this lengthy exchange reform.

Think about the distance from 2% to 12%. I believe that in 2015, there will be no substantive breakthrough in the exchange rate reform and the pace of internationalization. The central bank will make decisions on the camera. The reforms in this area will be fast and slow, depending on the international and domestic situation at that time.