Short-term costs rise again

After the midday break in New York on Wednesday afternoon, fluctuating between 6.5250-6.5300, almost parity on the shore; the open market this week totaled 595 billion yuan reverse repurchase expiry date, a large number of which will expire on Thursday. .

It is expected that the 7-day repurchase rate will rise from the current 2.29% to 2.5% in the near future.

The Chinese central bank set the middle price of the *** to the US dollar at 6.5237 on Wednesday, down 107 points from the middle of Tuesday's price of 6.5130 yuan, compared with the previous mid-week price of only 12.

The sharp downward adjustment by the People’s Bank of China and the exchange rate of the US dollar drove the rapid decline after the opening of the bank and continued at around 6.5250.

However, the difference between the US dollar exchange rate and the offshore US dollar exchange rate on the shore is not significant, indicating that the market's expectation of devaluation has not increased.

Chinese banks may be more inclined to retain more offshore liquidity in the short term.

According to data released by the China**** Center, the Bank of Reuters slumped 0.16% to 6.5290/USD on Wednesday; the transaction volume on the shore increased by 13.87% to US$15.8 billion on Wednesday.

The cost of funds in the offshore market rose. HIBOR overnight rose to 3.401%, the highest in one month; short-selling costs in offshore deadlines rebounded from Tuesday's low, and the one-week implied rate of return rose from below 5% to 6.13%. the above.

Liu Jie, a senior interest strategist at Standard Chartered Bank, anticipates that the liquidity of offshore liquidity will only be tightened slightly from the current status quo. It is expected that extreme tension will not be reproduced.

Mizuho Bank’s strategist Zhang Jiantai wrote in a report to clients that the central bank’s open market operations have been significantly reduced after the Spring Festival, which may trigger market concerns that onshore liquidity will be transmitted to shore.