In late December 2025, the domestic financial market showed periodic activity due to the interweaving of multiple factors. For the tenth consecutive month, the central bank achieved net investment through the medium-term lending facility (MLF). Semiconductor Manufacturing International Corporation announced a 10% price increase for 8-inch wafers, and the RMB exchange rate rose strongly against the US dollar. Although the three major events belong to the fields of currency, industry, and foreign exchange, they jointly reflect the core characteristics of the current economic and financial operations: policy regulation has become more precise, industrial supply and demand have structurally improved, and the external environment has improved marginally. Wmax The market observation team is based on public information to sort out its internal correlation and market implications.

Monetary Policy: Liquidity Support Shifts to "Stabilizing Expectations" Orientation

On December 25, the central bank launched a 400 billion yuan one-year MLF operation, with a net investment of 100 billion yuan, continuing the continuous net investment trend since March. Throughout the year, a total of nearly 5 trillion yuan of mid-term liquidity was provided through MLF and buyout reverse repurchase, effectively hedging seasonal tightening pressures such as government bond issuance and the expiration of interbank certificates of deposit.

What deserves more attention are the subtle changes in policy formulation. The fourth quarter monetary policy regular meeting clearly stated for the first time that "use stock buybacks, increase holdings, and re-lending and other tools to maintain the stability of the capital market," which shows that the goal of monetary policy has been expanded from simply "stabilizing growth" to "stabilizing expectations + stabilizing asset prices." This cross-market synergy is intended to alleviate year-end funding fluctuations and also provide indirect support for risky assets. The market interpreted this as a sign that policymakers attach great importance to financial stability, rather than as a signal for a new round of strong stimulus.

Industry signal: Semiconductor price increases reflect the rebalancing of supply and demand in mature processes

On December 24, SMIC announced a 10% price increase for its 8-inch BCD process platform, and the world's leading manufacturers followed suit. This round of price increases is not an isolated incident, but the result of the resonance of multiple factors: AI infrastructure construction has boosted demand for power management chips, leading companies such as TSMC have withdrawn from 8-inch production capacity, and the high cost of raw materials such as copper and gold has led to continued tightness in global mature process production capacity.

Data shows that SMIC’s 8-inch production line utilization rate has reached 95.8%, and Huahong Semiconductor is even overloaded to 109.5%. High capacity utilization and proactive price increases mark the improvement of the voice of domestic semiconductor companies in mature process fields. The market has responded positively, and the valuation of the technology sector has been restored in the short term. However, it should be noted that this price increase is concentrated on specific process platforms and has not yet spread to the entire industry. Its sustainability still depends on the resilience of downstream demand and the pace of production capacity expansion.

Exchange rate stabilization: Internal and external factors jointly promote the phased strengthening of the RMB

As of December 25, 2025, the onshore RMB closed at 7.0066 yuan against the US dollar, achieving three consecutive gains; the offshore RMB once approached the 7.00 mark, hitting a new high since October 2024. This round of appreciation has clear internal and external driving logic:

External: The Federal Reserve cut interest rates by 25 basis points as scheduled in December, the US dollar index fell back below 98, and non-US currencies generally rebounded; Internal: Corporate demand for foreign exchange settlement was released seasonally at the end of the year, and historical data showed that the average amount of foreign exchange settlement by banks on behalf of customers in December exceeded US$170 billion, forming a natural support.

It is worth noting that the central bank has not allowed unilateral appreciation expectations to ferment, and the central parity guidance still reflects the "stable but strong" approach. The market generally expects that the RMB may maintain a moderate appreciation trend amid two-way fluctuations in the short term, which will help improve expectations for cross-border capital flows, especially benefiting import cost-sensitive industries and companies holding US dollar liabilities.

Co-movement effect: cross-market sentiment improves but structural divergence

The above three positive factors are creating cross-market linkages:

Expectations of loose liquidity support active trading in A-shares, with turnover exceeding 400 trillion yuan for the first time this year; rising semiconductor prices have catalyzed short-term sentiment recovery in the technology sector, but funds are focused on leaders rather than spreading throughout the industry; the stabilization of the renminbi has eased the pressure on foreign capital outflows, and the volatility of northbound funds has dropped significantly.

However, the market did not form a comprehensive optimistic consensus. Some institutions pointed out that MLF's net investment is more of a hedging operation and does not mean the restart of total volume easing; semiconductor price increases are limited to mature processes, and advanced processes are still under pressure; RMB appreciation is also subject to the rigidity of the interest rate differential between China and the United States. Therefore, the current market situation is more reflected in the identification of structural opportunities rather than a pickup in systemic risk appetite.

Conclusion: Focus on mechanics, not trend bets

The periodic activity in the financial market at the end of the year reflects the short-term resonance of policies, industries and the external environment, rather than the establishment of long-term trends. Wmax Market Watch reminds users:

The "precision drip irrigation" of the policy toolbox does not mean flood irrigation; the improvement of industrial prosperity has the characteristics of subdivisions; exchange rate fluctuations will still be subject to the dual constraints of central bank policies and the U.S. dollar cycle. True insight comes from understanding “why something happens” rather than chasing “the next hot thing.” During the New Year window period, it is more important to maintain attention to the logic of the mechanism than to bet on the direction.