Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - China's foreign exchange market maintained strong resilience and vitality in September, with cross - border capital flows remaining active and balanced, and supply and demand in the foreign exchange market being relatively balanced. The total scale of China's foreign - related payments and receipts in the first three quarters reached a record high [1]. - The prices of crude oil, precious metals, and stock indices showed different trends. Crude oil prices were difficult to reverse the downward trend; precious metals experienced significant adjustments at high levels; stock indices were about to enter a direction - selection stage [1][2][3][4]. 3. Summary by Relevant Catalogs 3.1当日主要新闻关注 - **International News**: As of October 21, the total debt of the US federal government exceeded $38 trillion for the first time, just over two months after reaching $37 trillion in mid - August [5]. - **Domestic News**: In September, the unemployment rate of the 16 - 24 age group in urban China was 17.7%, 7.2% for the 25 - 29 age group, and 3.9% for the 30 - 59 age group [6]. - **Industry News**: In the first three quarters, the total transport turnover, passenger volume, and cargo volume of the civil aviation industry were 1220.3 billion ton - kilometers, 580 million passengers, and 739,500 tons respectively, with year - on - year increases of 10.3%, 5.2%, and 14% [7]. 3.2外盘每日收益情况 - The S&P 500 index decreased by 0.53%, the European STOXX 50 index decreased by 0.47%, and the FTSE China A50 futures increased by 0.10%. ICE Brent crude oil increased by 4.36%, while London gold and silver decreased by 0.64% and 0.46% respectively. Other varieties also showed different degrees of increase or decrease [10]. 3.3主要品种早盘评论 - **Financial Products** - **Stock Indices**: After a high - level shock in September, stock indices were about to enter a direction - selection stage. The domestic liquidity environment was expected to remain loose, and external funds were also likely to flow in. The market style might return to value in the fourth quarter [4][11]. - **Treasury Bonds**: The central bank was expected to continue implementing a moderately loose monetary policy, and there might be reserve requirement ratio cuts and interest rate cuts in the fourth quarter, which would support the price of treasury bond futures [12][13]. - **Energy and Chemical Products** - **Crude Oil**: SC crude oil rose 1.65% at night, but the downward trend of oil prices was difficult to reverse [2][14]. - **Methanol**: Methanol prices fell 0.13% at night. The operating rate of domestic coal - to - olefin plants decreased, and coastal methanol inventories continued to rise. The methanol market fluctuated more due to various uncertainties [15]. - **Rubber**: Rubber prices fluctuated on Wednesday. Supply pressure might gradually emerge, and demand support was relatively limited. The market was expected to fluctuate and adjust in the short term [16]. - **Polyolefins**: Polyolefin futures rebounded slightly. After continuous declines, the market sentiment gradually stabilized [17]. - **Glass and Soda Ash**: Glass futures closed slightly up, and soda ash futures rebounded slightly. Both were in the process of inventory digestion, and the market was still cautious [18][19]. - **Metals** - **Precious Metals**: Gold and silver prices adjusted significantly at high levels. After a rapid rise, there were profit - taking positions, and the driving factors weakened, leading to sharp price adjustments [3][20]. - **Copper**: The supply of copper concentrates remained tight, and the smelting output continued to grow. The Indonesian mine accident might lead to a supply - demand gap in the global copper market, supporting copper prices in the long term [21]. - **Zinc**: Zinc prices rose at night. The smelting output was expected to continue to increase. Due to different inventory situations at home and abroad, domestic zinc prices might be weaker than foreign ones, and the overall price might fluctuate within a range [22]. - **Lithium Carbonate**: Supply increased, demand showed some growth, and inventory decreased. The futures price fluctuated and rose. It was expected to remain volatile in the short term, and the downward adjustment space was limited [23]. - **Black Metals** - **Coking Coal and Coke**: The double - coking futures oscillated at night. The steel price and demand showed some improvement, but the possibility of blast furnace production cuts due to shrinking profits could not be ignored. The short - term market was expected to oscillate at a high level [24][25]. - **Iron Ore**: Iron ore prices stabilized. The demand for iron ore was supported, and the global iron ore shipment decreased recently. The port inventory decreased rapidly. The market was expected to be strong and fluctuate upward [26]. - **Steel**: Steel prices were stable and improving. The supply pressure was gradually emerging, and the inventory continued to accumulate. The overall supply - demand contradiction was not significant. The market was expected to be bullish in the medium term [27]. - **Agricultural Products** - **Protein Meal**: Bean and rapeseed meal prices oscillated and rose at night. The US soybean export inspection volume was higher than expected, and the Brazilian soybean planting progress was good. The domestic market was expected to fluctuate weakly in the short term [28]. - **Oils and Fats**: Oils and fats prices were weak at night. The production and export of Malaysian palm oil increased, but the market was under pressure due to uncertainties in Sino - US trade [29]. - **Sugar**: Zhengzhou sugar prices were weak at night. The global sugar market entered the inventory accumulation stage, and the domestic sugar market was expected to fluctuate in the short term [30]. - **Cotton**: Zhengzhou cotton prices oscillated. The US cotton market was in a short - term oscillation. The domestic cotton market was under pressure from weak demand, but the price was supported by factors such as slow harvesting progress and rising purchase prices. It was expected to be strong and fluctuate in the short term [31]. - **Shipping Index** - **Container Shipping to Europe**: The EC index was strongly oscillating. Maersk's price increase in November indicated its intention to support prices. The market continued to bet on the year - end peak season, and the upward driving force was accumulating. The far - month contract was slowly recovering, and attention should be paid to the progress of the Israel - Palestine cease - fire negotiation [32].

Core Viewpoint - The foreign exchange market in China demonstrates strong resilience and vitality, with active and balanced cross-border capital flows and a stable supply-demand relationship [1] Group 1: Foreign Exchange Market - In September, China's foreign exchange market operated smoothly, characterized by active and balanced cross-border capital flows [1] - The total scale of foreign-related income and expenditure in the first three quarters reached 11.6 trillion USD, a historical high for the same period [1] - Net capital inflow was 119.7 billion USD, and the bank's foreign exchange settlement and sales surplus was 63.2 billion USD, both higher than the same period last year [1] Group 2: Commodities Oil - The main crude oil contract rose by 1.65% to 449.1 CNY per barrel [1] - U.S. crude oil inventories, including strategic reserves, totaled 831.388 million barrels, down by 142,000 barrels from the previous week [2] - The downward trend in oil prices remains difficult to change despite recent fluctuations [2] Precious Metals - Gold and silver experienced significant adjustments at high levels, with the potential for further easing in the Russia-Ukraine conflict [3] - Central banks continue to increase gold holdings amid rising distrust in the current financial system, enhancing gold's status as a safe-haven asset [3] - After rapid price increases, profit-taking has led to sharp adjustments in gold prices [3] Stock Indices - The three major U.S. indices fell, with the oil and petrochemical sectors leading gains while the non-ferrous metals sector lagged [4] - The financing balance increased by 14.054 billion CNY to 2.427285 trillion CNY on October 21 [4] - The market is expected to enter a phase of directional choice, with a potential shift towards value recovery in the fourth quarter [4] Group 3: Key News International News - As of October 21, the U.S. federal government debt exceeded 38 trillion USD for the first time, marking a significant increase in a short period [7] Domestic News - The unemployment rate for urban labor aged 16-24 was 17.7% in September, indicating ongoing labor market challenges [8] Industry News - The civil aviation industry completed a total transportation turnover of 1220.3 billion ton-kilometers in the first three quarters, reflecting a year-on-year growth of 10.3% [9]

Core Insights - Since the "14th Five-Year Plan," China's foreign exchange market has shown resilience and stability, with significant growth in cross-border capital flows and the international influence of the Renminbi [1][2][3] Group 1: Foreign Exchange Market Performance - The foreign exchange market's trading volume is projected to reach $41 trillion by 2024, a 37.4% increase from 2020 [1] - The scale of cross-border receipts and payments is expected to be $14 trillion by 2024, reflecting a 64% growth compared to 2020 [1] - The net inflow of foreign investment into China from 2021 to mid-2025 is over $740 billion [2] Group 2: International Balance of Payments - China's international balance of payments has maintained basic equilibrium, with steady increases in foreign financial assets and liabilities [2] - The average annual scale of goods trade imports and exports from 2021 to 2024 is nearly $6 trillion, a 43% increase compared to the "13th Five-Year Plan" [2] - The net foreign assets of China stand at $3.8 trillion, ranking third globally [2] Group 3: Resilience and Risk Management - The resilience of the foreign exchange market has improved, enhancing its ability to withstand external shocks [3] - The percentage of enterprises using foreign exchange hedging has increased from 17% in 2020 to around 30% [3] - The share of Renminbi in cross-border trade has risen from 16% to nearly 30% [3] Group 4: Efficient Allocation of Foreign Exchange Resources - The foreign exchange market has developed a comprehensive product system, including spot, forward, swap, and options [4] - By mid-2023, 703 banks and 115 non-bank institutions, including 296 foreign institutions, participated in the interbank foreign exchange market [4] - The Renminbi has maintained its position as the fifth most traded currency globally, with a market share of 8.5%, an increase of 1.5 percentage points from 2022 [4] Group 5: Policy Enhancements for Enterprises - The foreign exchange management authority has focused on optimizing policies to benefit enterprises and the public [5] - Since 2021, policies for facilitating high-quality enterprises have been upgraded, with approximately $4.7 trillion in facilitation transactions processed by September 2025 [6] - The implementation of a "one-stop" service for trade foreign exchange business has streamlined processes for enterprises [6] Group 6: Future Directions - The foreign exchange management authority aims to balance trade facilitation and risk prevention, enhancing public awareness of policy benefits [7]

Core Viewpoint - The People's Bank of China (PBOC) emphasizes the need for a moderately loose monetary policy to address domestic demand insufficiency and low price levels while promoting stable economic growth and reasonable price levels [2][4]. Group 1: Economic Conditions - China's economy is showing steady progress, with improved social confidence and new achievements in high-quality development, but still faces challenges such as insufficient domestic demand and low price levels [2]. - The market has high expectations for policy strength amid ongoing downward pressure on the economy [4]. Group 2: Monetary Policy Strategy - The PBOC plans to implement a moderately loose monetary policy, enhance counter-cyclical adjustments, and better utilize both total and structural monetary policy tools [2]. - The central bank aims to maintain ample liquidity and guide financial institutions to increase credit supply, aligning social financing scale and money supply growth with economic growth and price level expectations [2][4]. Group 3: Policy Implementation - The PBOC suggests that monetary policy adjustments should be flexible based on domestic and international economic conditions, without setting specific policy windows [4]. - There is a focus on strengthening the guidance of central bank policy rates and improving the market-based interest rate transmission mechanism [4]. Group 4: Support for Specific Sectors - The PBOC is committed to supporting the development of the private economy and enhancing financing for small and micro enterprises, addressing financing bottlenecks [5]. - Efforts will be made to implement existing financial policies effectively, boost the vitality of existing real estate and land, and stabilize the real estate market [5].

Core Viewpoint - The People's Bank of China emphasizes the need for proactive and targeted monetary policy adjustments to align with domestic and international economic conditions, aiming to enhance the effectiveness of policy measures [1] Monetary Policy Strategy - The meeting discussed strengthening monetary policy regulation and improving its foresight, targeting, and effectiveness based on economic and financial market conditions [1] - It is suggested to maintain ample liquidity and encourage financial institutions to increase credit supply, ensuring that the growth of social financing and money supply aligns with economic growth and price level expectations [1] Interest Rate Management - The central bank aims to reinforce the guidance of policy interest rates and improve the transmission mechanism of market-based interest rates, enhancing the self-discipline of market interest rate pricing [1] - There is a focus on executing and supervising interest rate policies to promote a decrease in the overall financing costs for society [1] Debt Market Monitoring - From a macro-prudential perspective, the meeting highlighted the importance of observing and assessing the debt market's performance, particularly the changes in long-term yields [1] Currency Stability - The central bank intends to enhance the resilience of the foreign exchange market, stabilize market expectations, and prevent excessive fluctuations in the exchange rate, maintaining the RMB's stability at a reasonable and balanced level [1]

Core Viewpoint - The People's Bank of China emphasizes the importance of monitoring cross-border capital flows and maintaining the stability of the RMB exchange rate in its monetary policy report for Q2 2025 [1] Group 1: Monetary Policy Measures - The report highlights the need for comprehensive measures to enhance the resilience of the foreign exchange market and stabilize market expectations [1] - It stresses the importance of preventing excessive fluctuations in the exchange rate while keeping the RMB at a reasonable and balanced level [1] Group 2: Risk Management - The central bank encourages enterprises and financial institutions to adopt a "risk-neutral" mindset [1] - Financial institutions are guided to provide exchange rate hedging services to small and medium-sized enterprises based on actual needs and risk-neutral principles [1] - The aim is to create a stable exchange rate environment for the real economy [1]

Group 1 - The core viewpoint is that despite the appreciation of the US dollar and the depreciation of other non-USD currencies, the Chinese yuan remains relatively stable, indicating resilience in China's foreign exchange market amidst complex international and domestic challenges [1][2]. - Foreign capital has been reducing its holdings of RMB-denominated bonds since February, raising concerns in the market, although this has not significantly altered the overall balance of cross-border capital flows [1][2]. - From January to May, the net inflow of cross-border funds related to goods trade reached $214.4 billion, a year-on-year increase of 66%, reflecting the growth in China's import and export activities [2]. Group 2 - The current account surplus remains robust, with a surplus of $88.9 billion in the first quarter, up 25% year-on-year, and is expected to maintain a certain scale in the second quarter [3]. - China's industrial and supply chains are stable, supporting a continued surplus in goods trade, which is essential for maintaining a balanced current account [3]. - The financial market's high level of openness is expected to enhance foreign investors' confidence in holding RMB assets long-term, as China continues to improve its legal and international framework for the bond market [4].

Core Viewpoint - The resilience of China's foreign exchange market has strengthened in the first half of the year, with significant surpluses in both bank foreign exchange settlement and cross-border payments, indicating a stable outlook for the market in the second half of the year [1][2]. Group 1: Foreign Exchange Market Performance - In the first half of the year, the bank's foreign exchange settlement surplus reached 85.2 billion USD, and the surplus for cross-border payments was 83.4 billion USD, primarily driven by high surpluses in goods trade and direct investment [2]. - The foreign exchange settlement rate increased slightly, with a rate of 66% for customer purchases from banks, up 2 percentage points from the previous year [2]. - The foreign exchange deposit balance for enterprises remained stable at 695.1 billion USD, with a settlement rate of 67%, which is an increase of 0.4 percentage points compared to the same period last year [2]. Group 2: Foreign Exchange Derivatives and Risk Management - The scale of enterprises using foreign exchange derivatives for risk management grew by 29% year-on-year, significantly outpacing the growth rate of foreign exchange settlement, raising the hedging ratio to 26%, an increase of 4.1 percentage points from the previous year [3]. - The foreign exchange reserve stood at 3.0713 trillion USD at the end of June, with fluctuations in value due to the rising dollar index and falling prices of major financial assets [3]. Group 3: Foreign Investment in Chinese Bonds - Despite recent international market volatility, foreign investment in Chinese bonds is expected to continue steadily, with foreign holdings of Chinese bonds remaining stable and accounting for over 50% by central bank institutions [4][5]. - By the end of 2021, China had attracted nearly 820 billion USD in cross-border bond investments, representing about one-third of the total external bond investment in emerging markets [4]. Group 4: Support for Enterprises in Managing Exchange Rate Risks - The foreign exchange bureau is actively supporting enterprises, especially small and medium-sized enterprises, in managing exchange rate risks by reducing hedging costs and enhancing their risk management capabilities [7][8]. - In the first half of the year, enterprises utilized foreign exchange derivatives to manage risks amounting to 755.8 billion USD, with nearly 17,000 new enterprises engaging in hedging, most of which are small and medium-sized [8].

Group 1: Report Summary - The report covers various industries including finance, energy, metals, black commodities, agriculture, and shipping [1][9][11] - It analyzes market performance, price trends, and influencing factors for different commodities and financial instruments [2][3][9] - Macroeconomic factors such as US tariff policies, central bank actions, and economic data are considered [2][9][14] Group 2: Industry Investment Ratings - No industry investment ratings are provided in the report Group 3: Core Views - The Chinese foreign exchange market shows resilience despite complex external situations [1] - Gold and silver may continue to be strong due to market risk aversion and long - term drivers [2][14] - Crude oil prices are affected by OPEC production, US inventory data, and trade tensions [3][11] - Steel prices may continue to be volatile and strong in the short term due to supply - demand balance and cost factors [4][20] Group 4: Summary by Directory 1. Main News - **International News**: Trump announced trade agreements with the Philippines and Indonesia, including tariff adjustments and market access [5] - **Domestic News**: At the end of Q2, RMB real estate loan balances increased, while personal housing loan balances decreased slightly [6] - **Industry News**: Russia maintains its forecast for grain production and expects significant grain exports [7] 2. Outer - market Daily Returns - Various outer - market indices and commodities showed different price changes on July 22 compared to July 21, including gains in the S&P 500, London gold, and losses in ICE Brent crude [8] 3. Morning Comments on Major Varieties **Financial** - **Stock Index**: A - shares are considered to have high investment value in the medium - to - long term, with different indices having different characteristics [9] - **Treasury Bonds**: Long - term treasury bond prices are falling, and market funds are relatively stable. External policies and economic data affect the market [10] **Energy and Chemical** - **Crude Oil**: Prices are falling, affected by OPEC production increases, US inventory changes, and trade tensions [3][11] - **Methanol**: Short - term prices are expected to be bullish due to changes in production load and inventory [12] - **Rubber**: Prices may slowly rise due to supply - side factors, while demand - side support is weak [13] **Metal** - **Precious Metals**: Gold and silver are likely to remain strong, but there are risks of Trump's tariff threats being realized [2][14] - **Copper**: Prices may fluctuate within a range due to factors such as processing fees and downstream demand [15] - **Zinc**: Prices may have wide - range fluctuations, and attention should be paid to factors like US tariffs and production [16] - **Lithium Carbonate**: Short - term prices may be strong, but there is no basis for medium - term reversal [17] **Black Commodities** - **Iron Ore**: Prices may be strong in the short term due to demand support and supply - demand imbalances in the medium term [19] - **Steel**: Prices may continue to be volatile and strong in the short term due to supply - demand and cost factors [4][20] - **Coking Coal and Coke**: Prices may rise further in the short term but are likely to peak after late August [21] **Agricultural Products** - **Soybean and Rapeseed Meal**: Prices are expected to be strong in the short term, affected by US soybean conditions and domestic supply [22] - **Oils and Fats**: Palm oil prices may be supported, and the overall market is expected to be in a volatile pattern [23] **Shipping Index** - **Container Shipping to Europe**: The market is in a weak state, and the peak of the seasonal peak season may be approaching [24]

Group 1 - The core viewpoint emphasizes the importance of agricultural modernization, particularly through technological innovation, as highlighted by General Secretary Xi Jinping [6] - The State Council has announced the implementation of the "Rural Road Regulations," which will take effect on September 15, 2025, aimed at improving rural infrastructure [7] - The report indicates that during the "14th Five-Year Plan" period, the level of protection and development capabilities for people with disabilities in China has significantly improved [10] Group 2 - The foreign exchange market in China has shown strong resilience and vitality in the first half of the year, performing better than market expectations [13] - In the first half of the year, new RMB loans amounted to 12.92 trillion yuan, with a significant increase in green loans and support for technology-based small and medium-sized enterprises [17] - The report on the "2024 Water Conservation" indicates an increase in total water usage, while the water consumption per unit of GDP and industrial output has decreased, reflecting improved water-saving levels [20]