On September 28, 2022, both offshore and onshore RMB exchange rates against the US dollar fell below the 7.20 mark, the first time since February 2008. As the RMB exchange rate against the US dollar continues to decline, the market is panic, and A shares fell sharply.
Since 2022, the RMB exchange rate against the US dollar has fallen by more than 10%. More importantly, there is no sign of stopping the decline. It is expected that the Federal Reserve will raise interest rates by twice this year. The RMB exchange rate still has downward pressure. So where is the bottom? Will it really fall below 8?
Due to the great downward pressure on the domestic economy and the sluggish real estate market, the moderate depreciation of the RMB is conducive to exports, but the depreciation will increase the cost of imported goods. Some companies with foreign debt will have more tight capital chains, especially airlines and real estate companies. Therefore, whether the RMB exchange rate against the US dollar will "break 8" will be determined by the economic situation in the long run, but in the short term, we need to pay attention to whether the central bank will take measures, such as hiccups, etc.
For domestic people, there is no need to worry too much about the depreciation of the RMB. After all, the depreciation is the exchange rate against the US dollar, which does not mean the depreciation of domestic purchasing power, but what needs to be paid attention to is the impact of depreciation on the domestic capital market and real estate market...
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