September RMB Real effective exchange rate rose 0.83%

The real effective exchange rate for the renminbi in September was 119.65, continuing its rally last month, rising by 0.83% on the Month-on-month, while the nominal exchange rate fell from March to 113.81, down 0.27% in a row, according to the latest data from the Bank for International Settlements, Yangshui.　　Analysts point out that the renminbi's nominal effective exchange rate has fallen continuously, while the actual effective exchange rate continues to diverge from its differences, indicating that inflation differentials between China and the western countries such as the US and Europe are widening, which is the main reason for the decline of real effective exchange rate. However, the continued fall in the renminbi's nominal effective exchange rate in September seems to be at odds with the yuan's performance in the month. In September, the renminbi accelerated the appreciation of the dollar, repeatedly created in 2005 since the new highs.　　The renminbi has risen 2.04% per cent against the dollar since June, when the change was resumed to the end of September, compared with a 1.44% per cent increase in September. In a statement, Stephen Green, chief economist at Standard Chartered Bank, said the renminbi's appreciation accelerated as the dollar weakened and the renminbi's exchange rate was lower than a basket of currencies.　　It is estimated that by the end of September, the renminbi had fallen 2.7% per cent against a basket of trade-weighted day indices compared with the basic level in mid-June. Green predicts that the renminbi's nominal effective exchange rate will rise in the next few months, and that the renminbi's nominal effective exchange rate will increase significantly as the dollar recovers from the decline of the end of the year in 2011.