Core Viewpoint - The foreign exchange market in China has shown resilience and vitality in the first half of 2023, with a steady increase in foreign exchange receipts and a net inflow of cross-border funds, exceeding market expectations [1][2]. Group 1: Foreign Exchange Market Performance - In the first half of 2023, the net inflow of cross-border funds from non-bank sectors reached $127.3 billion, continuing the trend from the second half of the previous year, with a 46% quarter-on-quarter increase in Q2 [1]. - The foreign exchange market maintained a basic balance in supply and demand, with active trading and stable foreign exchange reserves [1][2]. Group 2: Capital and Financial Account Analysis - The increase in the current account surplus corresponds to an expansion of the capital and financial account deficit, which should not be interpreted as increased capital outflow pressure [2]. - The capital and financial account deficit is primarily due to increased outward investment by domestic entities, while foreign investment in China remains net inflow [2]. Group 3: Attractiveness of Renminbi Assets - The Renminbi appreciated by 1.9% against the US dollar in the first half of 2023, with the exchange rate fluctuating between 7.15 and 7.35, indicating stability and serving as an automatic stabilizer for the macroeconomy and international payments [3]. - Foreign investment in Renminbi-denominated bonds has increased, with foreign holdings exceeding $600 billion, and net foreign purchases of domestic stocks and funds reached $10.1 billion in the first half of 2023 [3][4]. Group 4: Future Outlook for Foreign Investment - The foreign investment in Renminbi assets is expected to have stable and sustainable growth, supported by a robust economic environment and improved financial market conditions [3][4]. - Approximately 30% of central banks surveyed indicated plans to increase their allocation to Renminbi assets, reflecting a growing global interest [4]. Group 5: Policy Initiatives for Trade and Investment - The State Administration of Foreign Exchange (SAFE) is implementing measures to enhance trade facilitation, cross-border investment, and financing, including reforms to streamline foreign exchange business processes [6][7]. - SAFE plans to expand innovative policies in free trade zones to promote cross-border trade and investment, including optimizing international trade settlement and enhancing the efficiency of foreign debt registration [7][8].

Core Viewpoint - The Chinese foreign exchange market has demonstrated resilience amid complex external conditions, maintaining stability and showing no significant unilateral appreciation or depreciation expectations for the Renminbi [1][2][4]. Group 1: Foreign Exchange Market Performance - In the first half of the year, the net inflow of cross-border funds from non-bank sectors reached $127.3 billion, continuing the trend from the second half of last year, with a 46% quarter-on-quarter increase in Q2 [2]. - The Renminbi appreciated by 1.9% against the US dollar in the first half, fluctuating within the range of 7.15 to 7.35, indicating its role as a stabilizer for macroeconomic and international balance of payments [2][3]. - The foreign exchange market has shown balanced supply and demand, with active trading and stable foreign exchange reserves [2][4]. Group 2: International Balance of Payments - The current account surplus has been steadily increasing, maintaining a reasonable equilibrium, while the non-reserve financial account has shown a deficit roughly equivalent to the current account surplus [3]. - Direct investment inflows into China reached $31.1 billion from January to May, a 16% year-on-year increase, while securities investment net inflows were approximately $33 billion, reversing the previous year's outflow trend [3][6]. Group 3: Foreign Investment in Renminbi Assets - Foreign investment in Renminbi assets has remained stable, with foreign holdings of domestic Renminbi bonds exceeding $600 billion, a historically high level [6]. - In the first half of the year, foreign investors net increased their holdings of domestic stocks and funds by $10.1 billion, reversing a two-year trend of net reductions [6]. - The attractiveness of Renminbi assets is expected to grow, with foreign investors currently holding about 3% to 4% of the market value of domestic bonds and stocks, indicating potential for sustainable growth in foreign allocations [6][7].

Report Overview - The report provides a comprehensive overview of the global asset market performance on July 21, 2025, including government bond yields, currency exchange rates, stock indices, and credit bond indices [3]. Global Asset Market Performance Government Bond Yields - **10 - year Government Bond Yields**: Yields and their changes over different time - frames (latest, one - week, one - month, one - year) are presented for major economies such as the US, UK, France, Germany, etc. For example, the US 10 - year government bond yield on July 21, 2025, was 4.379%, with a latest change of - 0.039 [3]. - **2 - year Government Bond Yields**: Similar data for 2 - year government bonds are provided for several economies. For instance, the US 2 - year government bond yield was 3.910% on July 21, 2025, with a latest change of 0.030 [3]. Currency Exchange Rates - **USD against Major Emerging Economies' Currencies**: Exchange rates and their percentage changes are shown for the US dollar against currencies like the Brazilian real, Russian ruble, South African rand, etc. For example, the exchange rate of USD to Brazilian real on July 21, 2025, was 5.567, with a latest change of - 0.22% [3]. - **Renminbi**: Data on on - shore and off - shore RMB, RMB mid - price, and 12 - month NDF are presented, along with their percentage changes [3]. Stock Indices - **Major Economies' Stock Indices**: Closing prices and percentage changes over different time - periods are provided for indices such as the S&P 500, Dow Jones Industrial Average, NASDAQ, etc. For example, the S&P 500 closed at 6305.600 on July 21, 2025, with a latest change of 0.14% [3]. - **Other Stock Indices**: Data for indices like the Russian index, Nikkei, Hang Seng Index, etc. are also included. For instance, the Hang Seng Index closed at 24994.140 on July 21, 2025, with a latest change of 0.68% [3]. Credit Bond Indices - Percentage changes over different time - frames (latest, one - week, one - month, one - year) are presented for different types of credit bond indices, including US investment - grade, euro - zone investment - grade, and emerging economies' investment - grade and high - yield credit bond indices [3][4]. Futures Trading Data Stock Index Futures - **Index Performance**: Closing prices, percentage changes, valuations (PE(TTM)), risk premiums, fund flows, trading volumes, and basis spreads are provided for A - shares, CSI 300, SSE 50, ChiNext, and CSI 500. For example, the CSI 300 closed at 4085.61 with a 0.67% change, and its PE(TTM) was 13.45 [5]. Treasury Bond Futures - Closing prices and percentage changes are presented for Treasury bond futures T00, TF00, T01, and TF01. For example, the closing price of T00 was 108.760 with a - 0.09% change [6]. Money Market - Interest rates and their daily changes are given for R001, R007, and SHIBOR - 3M. For example, the R001 rate was 1.4012% with a - 11.00 BP change [6].

Core Viewpoint - The State Administration of Foreign Exchange (SAFE) is actively working to mitigate external shock risks and maintain a stable and healthy foreign exchange market [1] Group 1: Foreign Exchange Management - SAFE emphasizes a managed floating exchange rate system based on market supply and demand, aiming to maintain the flexibility of the Renminbi exchange rate [1] - The agency is focused on optimizing foreign exchange policy supply and deepening reforms and opening up in the foreign exchange sector [1] Group 2: Trade and Investment Facilitation - SAFE aims to enhance the convenience of cross-border trade and investment financing [1]

Core Viewpoint - The foreign exchange market in China has shown significant activity in the first half of the year, with a notable increase in trading volume compared to the previous year [1] Group 1: Market Activity - In the first half of the year, the total trading volume in the domestic RMB foreign exchange market reached 21 trillion USD [1] - This represents a year-on-year growth of 10.2% [1]

Core Viewpoint - The political turmoil in Japan is causing significant ripples in the financial markets, with concerns about the country's fiscal outlook intensifying following the ruling coalition's defeat in the House of Councillors election [1]. Group 1: Political Developments - Prime Minister Shigeru Ishiba's ruling coalition suffered losses in the recent elections, leading to increased calls within the Liberal Democratic Party (LDP) for his resignation [1][8]. - Several LDP members have publicly demanded Ishiba step down, indicating a loss of support following two election defeats [1][9]. - The LDP is facing its weakest parliamentary position in 70 years, having lost majority seats in both houses, which raises concerns about the party's future leadership [9][10]. Group 2: Market Reactions - Following the election results, the Japanese bond market showed signs of weakness, with prices of 20-year and 40-year government bonds declining and yields rising by 1 and 4 basis points respectively [1][6]. - The Japanese yen depreciated approximately 0.2% against the US dollar, trading at 147.7, while the stock market also faced pressure [1][5]. Group 3: Economic Implications - Analysts warn of a potential "triple decline" scenario for the yen, bonds, and stocks due to political uncertainty, which could lead to higher bond yields as Ishiba may need to make fiscal concessions to appease opposition parties and voters [5][7]. - The weak performance of the bond market reflects investor concerns over government fiscal expansion, with expectations of a steepening yield curve, particularly for long-term bonds [6][10]. - The ongoing political instability may hinder Japan's ability to effectively negotiate in international trade discussions, particularly with the US, which has threatened to impose tariffs on Japanese exports [7][10].

Group 1 - Gold prices experienced a significant surge on July 21, closing at $3,396.93 per ounce, an increase of $47.09 or 1.41% [1] - The rise in gold prices was primarily driven by a sharp decline in the US dollar and US Treasury yields, with the dollar index (DXY) falling by 0.64% to 97.83 [2] - The 10-year US Treasury yield dropped over 6.5 basis points to 4.356%, while the real yield fell by 6 basis points to 1.946% [2] Group 2 - The impending August 1 deadline for tariff negotiations has heightened uncertainty in the market, contributing to increased demand for gold as a safe-haven asset [3] - US President Trump threatened to impose tariffs of up to 30% on EU products, complicating negotiations that were initially expected to result in a 10% tariff agreement [3] - The EU is considering retaliatory measures, including the use of the "nuclear option" to limit US companies' access to the €2 trillion public procurement market [3] Group 3 - Speculation regarding potential early interest rate cuts by the Federal Reserve has created unease in the market, with discussions about the effectiveness of the Fed being raised [4] - The market sentiment is influenced by fears of inflation due to tariff-related concerns, although no significant inflation effects have been observed yet [4] Group 4 - Analysts indicate that gold prices have broken above the $3,300-$3,350 per ounce range, with bullish momentum strengthening [5] - The Relative Strength Index (RSI) has risen towards 60.00, suggesting that bullish sentiment is dominant [6] - If gold closes above $3,400 per ounce, it is expected to test the June 16 high of $3,452 per ounce, with a potential target of the historical high of $3,500 per ounce [6]

Group 1 - The core concept of foreign exchange rates is the exchange ratio between one country's currency and another, which is influenced by complex mechanisms [1] - Foreign exchange rates arise from international economic interactions, such as trade, investment, and labor exports, necessitating a reasonable exchange ratio for transactions [1] - The foreign exchange market is the primary venue for the formation of exchange rates, involving various participants including commercial banks, multinational corporations, and central banks [1][2] Group 2 - Supply and demand dynamics are direct factors affecting exchange rates; an increase in demand for a currency, with stable or decreasing supply, leads to appreciation of that currency [2] - Economic fundamentals, such as a country's growth rate and inflation, significantly influence exchange rates; stable economic growth attracts foreign investment, increasing demand for the currency [2] - Interest rates also play a crucial role; higher interest rates attract foreign investors, increasing demand for the currency and leading to its appreciation [3] Group 3 - Political stability is vital for attracting foreign investment, which supports the currency's value; political turmoil can lead to decreased demand for the currency and depreciation [3]

Summary of Key Points Core Viewpoint - The interbank foreign exchange market shows a mixed trend in the Renminbi exchange rates against various currencies, indicating fluctuations in the currency's value. Currency Exchange Rate Changes - The USD/CNY rate is reported at 7.1522, an increase of 24 points, indicating a depreciation of the Renminbi against the US dollar [1] - The EUR/CNY rate is at 8.3228, up by 77 points, reflecting a stronger Euro against the Renminbi [1] - The HKD/CNY rate is 0.91125, up by 3.3 points, showing a slight appreciation of the Hong Kong dollar [1] - The GBP/CNY rate is reported at 9.6022, down by 127 points, indicating a depreciation of the British pound against the Renminbi [1] - The AUD/CNY rate is at 4.6595, up by 68 points, suggesting a stronger Australian dollar [1] - The CAD/CNY rate is reported at 5.2152, an increase of 48 points, indicating a stronger Canadian dollar [1] - The JPY/CNY rate is at 4.8255, down by 7 points, reflecting a weaker Japanese yen [1] - The CNY/RUB rate is reported at 10.9649, up by 832 points, indicating a significant appreciation of the Renminbi against the Russian ruble [1] - The NZD/CNY rate is at 4.2594, up by 12 points, suggesting a stronger New Zealand dollar [1] - The CNY/MYR rate is reported at 0.59231, down by 9.6 points, indicating a weaker Renminbi against the Malaysian ringgit [1] - The CHF/CNY rate is at 8.9310, up by 135 points, reflecting a stronger Swiss franc [1] - The SGD/CNY rate is reported at 5.5717, up by 25 points, indicating a stronger Singapore dollar [1]

Market Performance - The São Paulo Stock Exchange index fell by 1.61%, closing at 133,000 points, after reaching an intraday historical high of 142,000 points on July 4 and a closing historical high of 141,000 points, indicating a sustained pullback [1] - The index has accumulated a decline of 2.06% for the week, with a consistent slight decrease from Monday to Thursday, forming a potential phase top, followed by an accelerated drop on Friday [1] Currency Movement - The Brazilian real depreciated by 0.61% against the US dollar, trading at 5.5796 reais, with a total weekly decline of 0.86% [1] Political Context - Eduardo Bolsonaro, son of former Brazilian President Bolsonaro, stated to CNN Brasil that US President Trump will not reduce the threat level regarding tariffs on Brazil, and that Trump would not acknowledge the election results if Bolsonaro does not participate [1] - On Friday, Bolsonaro mentioned that his son may seek to acquire US citizenship [1]