The U.S. printed a lot of money, but it caused the dollar to rise? What is the logic behind it?
As one of the largest economies in the world, the United States usually prints money to save the market in order to maintain the liquidity of the financial market in the face of economic crisis. What is strange, however, is that under the condition that the United States has printed a large amount of money, the yuan has not only not depreciated, but on the contrary has a tendency to rise. Why didn't the yuan print a lot of money but appreciated? What kind of economic mechanism is there?
First of all, the United States is one of the world's major reserve currency issuers, and the yuan is one of the world's major reserve currencies. This means that the meta has a wide range of liquidity and application in the world, and plays a vital role in international settlement and reserve asset allocation. Therefore, even though the United States printed a lot of money, the global demand for the yuan was still very strong, which provided a solid foundation for the stability of the yuan. Globally, central banks and financial institutions hold large amounts of meta assets, which means that the meta continues to attract large capital inflows globally, making it difficult for the meta to depreciate in the short term.
Second, the U.S. economy is large and complex, and its influence on the world economy far exceeds that of other countries. While the U.S. prints a lot of money, its sheer size of its economy and position in the global market make it resilient enough. When the global economy is in turmoil, investors look for safe-haven assets, and the metaverse is often one of their top choices. This kind"The safe harbor effect"This means that even if the United States prints a lot of money, it can attract global investors to pursue the yuan, thereby driving the appreciation of the yuan exchange rate.
In addition, the United States, as the world's largest oil consumer, together with oil, provides strong support for the yuan exchange rate. Since the 70s of the 20th century, oil** has been dominated by meta, which makes the global buying and selling of oil not only require a large amount of meta settlement, but also a large amount of meta reserves. Therefore, regardless of whether the United States prints a lot of money or not, the global demand for oil will drive the demand for the yuan, thus stabilizing the yuan exchange rate.
The increase in liquidity brought about by the large-scale printing of money in the United States has the potential to promote the recovery and growth of the US economy, which in turn will have a positive impact on the yuan exchange rate. Especially during financial crises and recessions, it has been the consistent practice of the United States to promote economic recovery by increasing the amount of money**. This not only boosted market confidence and promoted the growth of investment and consumption, but also made the United States more stable in the global economic position, thereby supporting the trend of the yuan exchange rate to a certain extent.
The yuan's status as a global reserve currency, the safe-haven effect, oil**, and the size of the U.S. economy provide stable support for the yuan's exchange rate. Although there is some downward pressure, in the current economic environment, the upward trend of the yuan can still be basically maintained. Of course, in the long run, the impact of the US economy and monetary policy on the yuan still needs to be carefully watched, because it is impossible for any country's currency to get rid of the constraints of market supply and demand and macroeconomic fundamentals.