The gap between the renminbi’s two exchange rates has widened to a record, fuelling speculation that Beijing intends to allow its currency to depreciate at a faster rate than previously seen.
The spread between the offshore market and the more tightly controlled onshore market is an embarrassment for the People’s Bank of China, which pledged in August to narrow the gap as part of its efforts to make its currency “freely usable”.
Investors around the world are worried that an unexpectedly fast depreciation will destabilise China’s economy. Some also fear it could trigger a wave of competitive devaluations across the region.
“During our investor meetings in December, the most significant risk that investors were worried about was a substantial devaluation of the renminbi,” wrote Timothy Moe, Goldman Sach’s chief Asia-Pacific equity strategist in a research note on Wednesday.
高盛(Goldman Sach)亚太区首席股票策略师慕天辉(Timothy Moe)周三在一份研究报告中写道：“在去年12月我们举行的投资者会议上，投资者担心的最重大风险就是人民币大幅贬值。”
The offshore renminbi fell to Rmb6.72 against the dollar as London traders took over from Beijing. It has now dropped more than 2 per cent this week.
Meanwhile the onshore rate, at Rmb6.55.
said Zhou Hao, strategist at Commerzbank. “In general, we think that the Chinese authorities will tolerate more weakness in the renminbi for the time being.”