China Intends To Use Offshore RMB Trading Gold In Shanghai Free Trade Zone

< p > the world's largest a href= "//www.sjfzxm.com/news/index_c.asp" > the gold consumer countries < /a > and the producer country China consider allowing the use of offshore RMB trading gold in the Shanghai free trade area.

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According to the draft plan proposed by Peng Bo, China's largest physical gold exchange, the Shanghai gold exchange, proposes to allow offshore RMB accounts holders to buy and sell 3 contracts provided by the exchange, including 99.99% gold in purity. P

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< p > contract terms gold can be traded to the free trade zone < a href= "//www.sjfzxm.com/news/index_c.asp" > warehouse < /a >.

Reporters couldn't reach Gu Wenshuo, spokesman for Shanghai Gold Exchange on telephone, newsletter and e-mail.

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< p > China set up a "a href=" //www.sjfzxm.com/news/index_c.asp "free trade zone < /a > in Shanghai this year as a test site for liberalization of interest rate and currency exchange rate.

The gold contract will expand the investment options of global RMB deposits. According to the valuation of Standard Chartered as of last month, the global RMB deposits in March reached at least 1 trillion and 500 billion yuan.

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Wallace Ng, a Shanghai trader at Gemsha Metals Co., said: "although it is very convenient to trade offshore renminbi in the FTA for foreign objects, the ability to cash in the renminbi in P is very important." Gemsha

It is good news that they try to open more markets to more people, but import quotas still restrict physical gold trading.

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< p > the Central Bank of China controls the import of gold through quota system.

According to the World Gold Council, HSBC Holdings and Australia's New Zealand Banking Group (ANZ) became the first bank authorized by the people's Bank of China to bring gold into China last year.

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< p > for the recent depreciation of the RMB, the mainstream view of the market here is that although the strength of the suspected large state-owned enterprises' share purchase from the end of 5 has boosted the decline of the spot exchange rate of RMB to some extent, the fundamental factors in the recent period may be the main reason for the RMB exchange rate to continue to oscillate and fall.

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< p > the latest statistics released by the central bank this week show that in April, the new central bank's foreign exchange quota was only 84 billion 600 million yuan, a sharp drop of more than 50% in the ring.

In the same period, all foreign financial institutions increased their foreign exchange reserves to 116 billion 900 million yuan, creating a new low of nearly 8 months.

In the light of the data that the commercial bank's foreign exchange surplus dropped to US $9 billion 700 million in April, the characteristics of market participants' willingness to settle foreign exchange in the two quarter have been very obvious.

On the one hand, concerns about the momentum of China's economic recovery have slowed down the inflow of foreign capital and promoted the expectation of RMB depreciation. On the other hand, the devaluation of the RMB against the US dollar has resulted in a decline in the willingness of domestic enterprises to settle their foreign exchange.

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< p > there is a market view that, with the gradual expansion of the real economy, the monetary authorities are happy to see that the RMB exchange rate continues to be weak at this stage, so as to boost the growth of the import and export sectors.

At the same time, the European Central Bank's new round of easing measures, which is already in the "corner", may also pry up the strength of the US dollar in the medium and long term.

Once the US dollar gradually becomes stronger, the RMB exchange rate will probably come down.

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< p > analysts said that in the context of macroeconomic fundamentals or continued weakness and the need for further easing of policy stimulus, the current weakening of the renminbi is still expected to be difficult to reverse and the US dollar index or stage strength is strong, the weakening of the RMB exchange rate is expected to continue in the coming period.

In fact, at the beginning of the year, some foreign institutions which had optimistic views on the appreciation of the RMB would still be looking ahead to the expected performance of the RMB exchange rate throughout the year.

For example, UBS recently indicated that the RMB exchange rate is expected to remain at a low level near 6.25 in the year.

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