Will the Renminbi 'break 7'?

The spot exchange rate of offshore and onshore Renminbi against the US dollar has fallen by 6.9 yuan for two consecutive weeks, and the 7-yuan integer pass has been exposed again. Will the renminbi "break 7" this time? On May 19, Pan Gongsheng, deputy governor of the People's Bank of China and director of the State Administration of Foreign Exchange, was interviewed by the media on the current operation of China's financial and foreign exchange markets. He said that, first, at present, China's economy is running smoothly on the whole, the main indicators remain in a reasonable range, the transformation of new and old momentum is accelerated, and the macroeconomic fundamentals are good. In April, China's Manufacturing Purchasing Managers Index (PMI) was 50.1%, which continued to be in an expansion range. Macro-policy has a large operating space and abundant policy tools. Since this year, sound monetary policy has strengthened counter-cyclical regulation, enhanced policy foresight and flexibility, maintained reasonable and abundant liquidity, promoted the rapid growth of social credit, moderately tightened monetary and financial conditions, and further increased financial sector support for private and small and micro enterprises. At the end of April, the broad currency M2 grew by 8.5% year-on-year, 0.2 percentage points higher than the same period last year. The stable operation of China's economy and Finance provides a strong basic support for the reasonable stability of the foreign exchange market and the RMB exchange rate. Since this year, China's foreign exchange market has been running smoothly, foreign capital inflows have increased, foreign exchange reserves have increased steadily, and the foreign exchange market is expected to be generally stable.

Second, we will unswervingly expand financial openness, maintain the continuity and stability of the financial reform and opening-up policy, resolutely implement the deployed financial reform and opening-up policy, further promote the two-way opening of financial markets, deepen the reform of foreign exchange management, improve the level of liberalization and facilitation of cross-border trade and investment, and earnestly safeguard the legitimate rights and interests of foreign investors, in accordance with the established guidelines. Domestic and foreign investors create a more convenient and friendly investment environment.

Third, in recent years, we have accumulated rich experience and sufficient policy tools in dealing with fluctuations in the foreign exchange market, and will take necessary counter-cyclical adjustment measures to strengthen macro-prudential management according to the changing situation. We should crack down on illegal and illegal activities in the foreign exchange market and safeguard the sound order of the foreign exchange market.

We have the foundation, confidence and ability to maintain the stable operation of China's foreign exchange market and the basic stability of the RMB exchange rate at a reasonable and balanced level.