China's monetary policy has been looking for a balance between the multiple objectives of "stabilizing prices, full employment, economic growth and international balance of payments". In the year when the domestic and international economic and financial situation has undergone significant changes, Quan Hengyou of monetary policy has shown great difficulties.

Since the fourth quarter of last year,

Analyst: two-way volatility or further expansion of exchange rate

In January 2012, the total value of foreign trade and import and export amounted to 272 billion 600 million US dollars, down 7.8% from the same period last year. Of them, exports were US $149 billion 940 million, down 0.5%, and imports 122 billion 660 million US dollars, down 15.3%.

Import and export "double drop" situation reappeared after several years.

Then, in February, it exported US $114 billion 470 million, imported $145 billion 960 million, and the trade deficit exceeded US $31 billion 400 million, creating the largest monthly deficit in 10 years, resulting in a total trade deficit of 4 billion 250 million US dollars in the first two months.

Central bank vice president Yi Gang said during the two sessions that from the two aspects of fundamentals and market performance, one is that the current trade deficit is a positive sign of the RMB exchange rate approaching the equilibrium level. Two, since the fourth quarter of last year, the market has formed a relatively continuous two-way expectation and two-way fluctuation of the RMB exchange rate.

The elasticity of two-way floating of RMB exchange rate is becoming more and more mature.

In the 1~2 months of this year, the two-way fluctuation of foreign exchange market continued.

After the February trade deficit data was released, the foreign exchange market moved. In March 12th, the central parity of the RMB against the US dollar fell by 209 basis points, the largest one-day drop in a year and a half, and the spot exchange rate fell sharply by 158 basis points.

"At present, it may be in the testing stage of the central bank to the market.

However, the two way fluctuation does not mean the end of the appreciation of the renminbi, and whether the appreciation of the renminbi has ended, Zhou Xiaochuan said, "it will not be that simple".

He pointed out that the RMB exchange rate mainly depends on market supply and demand.

The global economic imbalance, China's economy itself is unbalanced, uncoordinated and unsustainable, and its correction process will not be very short.

In March 26th, the central parity of the RMB against the US dollar was 6.2858, and it has hit a new high since the reform.

Deposit rate cut temporarily hedge foreign exchange holdings

"Deposit reserve and hedge foreign exchange occupation are just like the two water banks of the central bank's liquidity. Now that the foreign exchange funds may put a little blockage in the water supply to the currency, then the deposit rate will increase the intensity of the release."

Zong Liang, deputy general manager of the Strategic Development Department of the Bank of China, made such a metaphor.

Now the appreciation of the renminbi will be a long-term trend. In this general trend, the RMB will fluctuate slightly, but it is not likely to form the expectation of depreciation at present. Therefore, the adjustment of monetary policy is mainly based on the application of the deposit rate reduction tool at the present stage. If there is a devaluation stage of the people's currency, there will be more powerful regulatory tools.

In January, foreign exchange accounted for an increase of US $140 billion 900 million, but by February, the growth rate has shrunk to 25 billion 100 million US dollars.

During the two sessions, Zhou Xiaochuan made it clear that in a certain period of time, if the balance of payments surplus was relatively large, the central bank would buy more foreign currencies, which would cause more liquidity. At this time, we would need to increase the impulse rate, that is to say, the reserve requirement ratio would be raised. Otherwise, the reserve requirement ratio would be lowered.

The latest research report of CICC believes that