Sport exchange rate of the Chinese currency Yuan, or RMB, against the US Dollar slipped by 0.15 percent in August 2013.
Hurt by worries that the US Federal Reserve will slash the QE size in September, the currencies of emerging markets depreciated in succession this August. For instance, the Indian currency Rupee depreciated about nine percent. In addition, the Indonesian Rupiah, the South African Rand and the Brazilian Reais each depreciated largely. While, the Chinese Yuan always maintained a strong momentum driven by good basic factors of the Chinese economy, with the spot exchange rate against the US dollar slipping by 0.15 percent.
An analyst said recently that the Chinese yuan performed well last month and the spot exchange rate against the US dollar drooped below 6.12 on August 7 and 6.11 on August 16, standing at 6.109, a record high. And in the month, the spot exchange rate against the US dollar slipped by 0.15 percent and the central parity rate against the US currency surged up by 79 basis points.
China released economic data for July this year in the month and in line with industry observers, it should be active signals rooted from the monthly economic data that help boost the Chinese currency. Firstly, the PMI continued rising. Secondly, the growth of both import and export became positive from negative. And all those indicated that the domestic economy had bottomed out. The South Korean currency Won performed well, too driven by stable foreign trade surplus, with the exchange rate against the US dollar dropping by 1.22 percent.
A report from the financial market division of China Guangfa Bank (CGB) shows that the Chinese Yuan resumed a net settlement in the foreign exchange market in the month and provided that the central parity rate against the US dollar still maintains at 6.16 to 6.18 and the sport one still maintained at 6.11 to 6.15 in the near future, it will indicate that moves the nations took to stabilize the exchange rate has begun working. The net settlement was relatively large in the month and this signals that the currency will be under pressure from a continuous appreciation within a short period of time. And if it wants to continue the appreciation, the central parity rate against the US dollar should drop below 6.15 and the spot one should fall below 6.11. Judging from the current market situation, there will be possibility for it to embrace a tiny appreciation in late September or October this year.
