中国经济与外汇策略_上调人民币预期，但通缩使我们低于共识-China Economics & FX Strategy-Revising Up RMB, but Deflation Keeps Us Below Consensus

Summary of Key Points from the Conference Call Industry Overview - Industry: Foreign Exchange (FX) and Economic Strategy in China - Company: Morgan Stanley Asia Limited Core Insights and Arguments - RMB Forecast Revision: The forecast for the USDCNY exchange rate has been revised upward, expecting it to reach 6.85 by Q1 2026 and finish at 7.0 by the end of 2026, compared to previous estimates of 7.05 for both periods [8][11] - Export Strength: Robust export momentum is anticipated to continue through 2026-27, with expected growth rates of 5-6% in export volume, supported by a strong external balance and improved competitiveness [12][9] - Deflationary Pressures: Lingering domestic deflation is a significant constraint on the RMB's appreciation potential, limiting the economy's ability to sustain a stronger currency [17][18] - Dollar Dynamics: The dollar is expected to weaken in the first half of 2026 due to anticipated Fed rate cuts, followed by a rebound in the second half as US economic growth accelerates [10][41] - Policy Guidance: The People's Bank of China (PBoC) has maintained a consistent FX policy aimed at managing volatility and preventing excessive exchange rate fluctuations, indicating a preference for stability around an equilibrium level [19][11] Additional Important Insights - Geopolitical Risks: Potential risks to the RMB outlook include renewed geopolitical tensions and capital outflows, which could negatively impact the currency [23] - Technical Analysis: The USD/CNH pair is currently oversold, and a break below 6.97 could lead to further downside towards approximately 6.80 [30][29] - Limited Spillover Effects: The recent strength of the CNH has had limited positive implications for other Asian currencies, with only the Malaysian Ringgit (MYR) showing a potential benefit due to its stronger relationship with the CNY [36][37] - Exporters' FX Conversion: Seasonal increases in exporters' FX conversion are expected, particularly in December, but may slow in January due to historical trends [24][26] This summary encapsulates the key points discussed in the conference call, focusing on the RMB's outlook, export dynamics, and the broader economic context affecting currency movements.