2. From the beginning of the founding of the People's Republic of China to the issuance of the new version of RMB
In 1949, the exchange rate of RMB against the US dollar was 42,000. This is the government used RMB to collect against the US dollar. Ordinary people cannot use RMB to exchange US dollars.
In 1950, the exchange rate of the RMB against the US dollar appreciated to 27,500.
At the beginning of 1951, the RMB exchange rate against the US dollar appreciated to 22380, and by the end of the year it depreciated slightly, and the exchange rate against the US dollar became 26170.
1952-1954, the RMB exchange rate against the US dollar was always fixed at 26170.
2. The new version of RMB was issued before the reform and opening up
1955 new version of RMB was issued, the exchange ratio of new and old RMB was 1:10,000, and the exchange rate between the RMB and the US dollar was 2.4618.
1956-1970, the RMB exchange rate against the US dollar was always fixed at 2.4618.
It is worth mentioning that on August 15, 1971, the Bretton Woods system collapsed, the US dollar no longer anchored to gold, the US dollar began a decade-long depreciation period, and the exchange rate of the RMB against the US dollar that year became 2.2673.
1972, the exchange rate of RMB against the US dollar was 2.2401; 1973, 2.0202; 1974, 1.8397; 1975, 1.9663; 1976, 1.8803; 1977, 1.7300; 1978, 1.5771; 1979, 1.4962.
4. From the beginning of reform and opening up to the single exchange rate
Since 1979, we have officially embarked on the historical pace of reform and opening up. The exchange rate of the RMB against the US dollar has depreciated moderately from the following year.
In 1980, the RMB exchange rate against the US dollar became 1.53.
1981, the RMB exchange rate against the US dollar was 1.7051. In that year, in order to promote reform and opening up, the country formulated a dual exchange rate system. In addition to fixed exchange rates, it also stipulated a price of trade foreign exchange that applies to import and export trade settlement and economic benefit accounting for foreign trade units. That was 1: 2.8.
1982, 1.8926; 1983, 1.9757; 1984, 2.3270.
By 1985, the country abolished the dual exchange rate system and changed to a fixed single exchange rate system. The exchange rate of the US dollar against the RMB was set to 2.3 - but in practice, it was found that it was significantly overvalued, and by the end of the year it was adjusted to 2.93.
At the same time, the country also sets a foreign exchange market adjustment exchange rate - this should be considered China's earliest market exchange rate. There is also an exchange rate for enterprises to earn foreign exchange costs at the end of the year. In fact, from 1985 to the end of 1993, there was a triple exchange rate system in China, namely the official exchange rate, the adjustment exchange rate for enterprise imports and the cost exchange rate for enterprise exports.
In the eight years before the triple exchange rate merger from 1985 to 1994, the RMB has depreciated, and the gap between our triple exchange rates is also large, generally between 1:2.8 and 1:8.7.
At the end of 1993, China implemented the reform of the exchange rate convergence system. On New Year's Day 1994, the official exchange rate of the RMB depreciated by 46%, from 5.8 to 8.7, and the RMB was informally linked to the US dollar.
5. After the single exchange rate reform to the managed floating exchange rate system
Since 1994, the RMB has been informally linked to the US dollar. At first, the exchange rate was determined to be 8.7, and later adjusted to 8.3. In the next 10 years, the RMB can only float against the US dollar in a very narrow range of 8.27 to 8.28 yuan.
6. The managed floating exchange rate system Before the 2008 financial crisis
On July 21, 2005, the People's Bank of China began to implement a floating exchange rate system based on market supply and demand, based on a basket of currencies, and managed. In 2006, it introduced the inquiry and trading method and the market maker system , which improved the formation method of RMB exchange rate mid-price . During this period, the exchange rate of the US dollar against the RMB fell from 1:8.28 to 1:6.84, and the RMB entered an appreciation cycle.
7. After the 2008 financial crisis, we exited the first quantitative easing
The outbreak of the financial crisis in 2008 has suspended the road to reform in China's exchange rate, and China has once again resumed its exchange rate strategy of keeping a close eye on the US dollar.
exchange rate against the RMB continued to decline from 1:6.65 in 2010 to 1:6.12 in 2014. In 2014, my country became the second country in the world to have over 10 trillion GDP, reaching 60% of the United States.
8. After the United States withdrew from quantitative easing to the first time it broke seven
Starting from the end of 2013, the United States gradually stopped quantitative easing. On August 11, 2015, we optimized the quotation mechanism for the RMB exchange rate against the US dollar. The RMB exchange rate changed from around 6.1 to around 6.3 on that day. In the 16 months after
, the RMB continued to depreciate until the US dollar gradually approached 70% against the RMB. On January 1, 2017, the central bank of took action again, and the exchange rate became around 6.8 within 2 days, and then the RMB began to appreciate continuously.
also started from this time, breaking seven has become a landmark point in the market.
9. Three breaks of seven in the past three years
Since 2019, the US dollar has broken seven against the RMB three times, and the reason for each time is different.
The first time was from August to September 2019. Due to the escalation of Sino-US trade frictions, many overseas investment institutions expect that there is great uncertainty in China's foreign trade and economic growth, and instead launched a large-scale shorting of the RMB arbitrage.
The second time was between April and May 2020. The circuit breaker of the US financial market, and the global outbreak caused a sudden tightening of US dollar liquidity, and even a US dollar shortage in the global financial market. The RMB exchange rate fell below the "7" integer mark because the US dollar index once rose above the 103 integer mark.
The third time is now. In September 2022, under the impact of the impact of the Federal Reserve's continued sharp hikes in . The US dollar index hit a new high and broke through 110, the RMB exchange rate was once again "breaking 7".
In fact, the 7 digit mark itself is indeed not very meaningful, but as the psychological mark for the people to view the exchange rate, it has attracted everyone's attention.
But through my introduction, you can think about it, in history, is the RMB appreciation economy more prosperous, depreciation economy develops faster, or the currency value is stable, and people's lives are happier,
See the essence through phenomena, find the truth through stripping the threads, changing the shape and opening up the brain, planning and thinking about countermeasures, thank you for your attention and gladness!
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