USD/CNY central parity rate rose for three consecutive days, lifting the onshore exchange rate to a high not seen in over two weeks.

On November 4, the RMB/USD central parity rate was quoted at 6.7180, down 30 basis points from the previous trading session, marking the third consecutive day of depreciation. It reached its weakest level since October 23 and was significantly weaker than Reuters' forecast of 6.6811.

According to Reuters, the onshore RMB dipped to around 6.68 in early trading, hitting its weakest point since October 19, while the offshore RMB weakened in tandem.

Prior to this, the People's Bank of China announced on November 3 that it would raise the foreign exchange deposit reserve requirement ratio for financial institutions from 4% to 6% starting November 15, marking the first increase since December 2021. Following the announcement, the USD/CNH pair surged more than 280 basis points intraday, touching 6.675.

Market analysts believe the move aims to curb an overly rapid appreciation of the RMB. The RMB has appreciated cumulatively by approximately 5% against the US dollar year-to-date, and the CFETS RMB Exchange Rate Index had previously reached a new high since July 2022.