SEB: Risks Rising For Need To Start Fed Tapering Timetable Soon

The video discusses the current state of US-China trade talks, highlighting a more constructive approach. Despite a hawkish US stance, the market has already priced this in. The renminbi is expected to gain, driven by factors like the southbound bond connect and significant dividend payments by Hong Kong-listed Chinese companies. The dollar-yuan rate is projected to move towards 6.20 by year-end, supported by strong capital inflows into Chinese equities and bonds. However, recent policy tweaks by the PBOC have only temporarily affected the yuan's appreciation, with historical trends suggesting a return to its upward trajectory.

What is the current stance of the US in the trade talks with China?

• Dovish

• Hawkish

• Neutral

• Uncertain

What is one of the main factors expected to support the yuan?

• Strong portfolio inflows

• Weakening Chinese economy

• Decreasing foreign investments

• Rising US interest rates

What is the expected trend for the dollar-yuan exchange rate by the end of the year?

• Appreciation towards 620

• Depreciation towards 720

• Volatility without a clear trend

• Stability around 650

How do Chinese authorities feel about the one-way appreciation of the yuan?

• Uncomfortable

• Supportive

• Comfortable

• Indifferent

What has been the historical effect of policy tweaks on the yuan?

• Temporary effect

• Permanent depreciation

• Long-term appreciation

• No effect