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4 Mar 2015
Chinese authorities might depreciate the CNY – ING
FXStreet (Barcelona) - Tim Condon of ING, expects the Chinese authorities to depreciate the CNY fixing rate rather than widen the USDCNY trading band, further forecasting another 2-3% spot depreciation this year.
Key Quotes
“Our baseline scenario is that the authorities depreciate the CNY fixing rate rather than widen the USDCNY trading band and we forecast another 2-3% spot depreciation this year.”
“We expect further policy interest rate cuts as needed to shore up flagging growth and we forecast one 25bp cut per quarter in the rest of the year. We expect the PBoC to cut the RRR as needed to sustain interbank liquidity and we forecast one 50bp cut per quarter through 2016.”
“The endgame as we see it is accommodative monetary policy leading to higher new home prices in tier 1 cities and the improved outlook for property turning hot money outflows into inflows.”
Key Quotes
“Our baseline scenario is that the authorities depreciate the CNY fixing rate rather than widen the USDCNY trading band and we forecast another 2-3% spot depreciation this year.”
“We expect further policy interest rate cuts as needed to shore up flagging growth and we forecast one 25bp cut per quarter in the rest of the year. We expect the PBoC to cut the RRR as needed to sustain interbank liquidity and we forecast one 50bp cut per quarter through 2016.”
“The endgame as we see it is accommodative monetary policy leading to higher new home prices in tier 1 cities and the improved outlook for property turning hot money outflows into inflows.”