30 Apr 2015
Revising USD/RMB forecast lower – HSBC Bank
FXStreet (Barcelona) - Strategists at HSBC Bank, revise their year-end forecast for USD/RMB, now anticipating a 2015 and 2016 target at 6.26 and 6.32 respectively.
Key Quotes
“China is suffering a cyclical slowdown and further interest rate cuts are likely. FX policy remains the crucial driver of the RMB, and it will stay biased towards maintaining stability in the value of the RMB for now. Policymakers see that as a way of supporting China’s structural reforms and as an important factor for RMB internationalisation and inclusion in the SDR.”
“Taking into account the recent USD consolidation and China's FX policy bias, we revise our year-end USD-RMB forecast to 6.26 and 6.32 for 2015 and 2016 respectively, from 6.34 and 6.44. Some modest RMB weakness is likely and deemed tolerable by the authorities.”
“We have argued that the RMB is less sensitive to monetary easing than other currencies. But this should change, as the RMB becomes more market determined. The expected divergence of monetary policy between the US and China should support a slightly higher USD-RMB.”
Key Quotes
“China is suffering a cyclical slowdown and further interest rate cuts are likely. FX policy remains the crucial driver of the RMB, and it will stay biased towards maintaining stability in the value of the RMB for now. Policymakers see that as a way of supporting China’s structural reforms and as an important factor for RMB internationalisation and inclusion in the SDR.”
“Taking into account the recent USD consolidation and China's FX policy bias, we revise our year-end USD-RMB forecast to 6.26 and 6.32 for 2015 and 2016 respectively, from 6.34 and 6.44. Some modest RMB weakness is likely and deemed tolerable by the authorities.”
“We have argued that the RMB is less sensitive to monetary easing than other currencies. But this should change, as the RMB becomes more market determined. The expected divergence of monetary policy between the US and China should support a slightly higher USD-RMB.”