In recent days, the RMB exchange rate against the US dollar has achieved an astonishing reversal, and the offshore exchange rate has exceeded 1,900 points in a row, which means that the RMB has won the global currency war. As a giant of the global economy, the United States not only occupies a strong position in the military field, but also cannot be ignored in the financial field. With the hegemony of the US dollar and its strong financial capabilities, the United States can launch a currency war to reap almost global economic benefits. The past has given the United States confidence in such wars, but this time the plot has developed in a completely opposite way to what the American capitalists expected. The United States has taken a two-pronged approach, on the one hand, through the Federal Reserve's sharp interest rate hikes, and on the other hand, through the large-scale issuance of US bonds, to suppress the currency exchange rates of other countries. However, unexpectedly, the dollar did not continue, on the contrary, there was a trend, and the issuance of US bonds did not attract investment from other countries as expected. It was in this context that the renminbi began to move sharply. Taking the offshore exchange rate as an example, it has increased by more than 1,900 points compared with the ** price of the previous month, and even more than 2,200 points compared with the lowest point in early September. This round of RMB is likely to be more than simple, but the emergence of a medium- and long-term trend, and may even achieve a counterattack against the dollar. Against the backdrop of the Fed's interest rate cuts next year, it is even possible to see USD/CNY fall to 6 in the coming yearsLevels below 0. At the same time, the international status of the renminbi will also be further enhanced. The latest data shows that in the ranking of the world's leading financing currencies, the RMB has surpassed the euro and ranks second. In the future, the renminbi is expected to occupy a larger share of global payment currencies. This means that the dollar may have to suffer the bitter consequences of losing the currency war.
1. The Fed's interest rate hike was unexpected, bringing adverse effects
In 2021, inflation in the United States continued to rise, but the Fed insisted that it was only temporary and was reluctant to raise interest rates. However, in 2022, the Fed abruptly changed its strategy and raised interest rates rapidly, raising them to 75 basis points at a time, and making four consecutive rate hikes. The effect of this unexpected interest rate hike was completely opposite to the expectations of the American financial capitalists, not only did not push up the dollar exchange rate, but on the contrary intensified the trend of the dollar.
2. The issuance of huge U.S. bonds did not meet expectations
At the same time, the U.S. Treasury Department received congressional approval to temporarily lift the debt ceiling and issue a large number of U.S. bonds. However, due to the rise in the federal benchmark rate, the auction yield on US Treasury bonds has also increased accordingly. U.S. bonds issued at high yields should have attracted more investment, but nearly 1 4 U.S. bonds in the latest auction failed. This means that investors' interest in US Treasuries has decreased, which in turn has led to the strengthening of the US dollar.
1. RMB may continue**
The trend of the renminbi may not be just short-term, but a medium- to long-term trend. Given the rapid decline in the US economic growth rate and the fact that the Federal Reserve will start cutting interest rates next year, it is even possible to see the USD/CNY exchange rate fall to 6 in the coming yearsLevels below 0. This will further enhance the renminbi's position in the global monetary system.
2. The renminbi surpassed the euro and became the second largest financing currency
The latest data shows that the renminbi has surpassed the euro and ranks second among the world's largest financing currencies. This means that in the international world, more and more countries choose to use RMB for settlement and financing, further consolidating the international status of RMB.
3. The proportion of RMB in global payment currencies may increase significantly
In the future, the share of the renminbi in the global payment currency is expected to further increase. With the advancement of the internationalization of the RMB and the rising status of China in the world, more and more countries will choose to use the RMB for payment and settlement, which further promotes the international influence of the RMB.
A currency war is a war waged between countries for economic gain. In this war, the United States, as the leader of the global economy, has been in a strong position. However, the recent renminbi ** shows that China, as the world's second largest economy, is growing in economic power and financial influence. U.S. tactical mistakes and China's nimble response allowed the renminbi to counterattack and win the currency war.
The rise of the renminbi is of great significance for China and the world economy. For China, the internationalization of the renminbi will further enhance China's position in the global economy and increase the competitiveness and influence of Chinese enterprises. For the world economy, the rise of the renminbi will increase the diversity and stability of the global monetary system and reduce overdependence on the US dollar.
However, we should also note that challenges for the renminbi remain. In order to truly realize the globalization of the renminbi, it is also necessary to strengthen financial reform and improve the liquidity and convertibility of the renminbi. At the same time, there is a need to maintain economic stability and improve the attractiveness of the domestic market. Only in this way can the renminbi continue to win the currency war and make greater contributions to the prosperity of China and the world economy.