What are the dangers of RMB appreciation to China?

The appreciation of the yuan is not the result of the cause, you should ask about the harm of the depreciation of the dollar.

It is because the country has depreciated for the dollar, and the yuan has to appreciate, and the key is oil, because oil is bought with dollars.

The biggest obstacle to the renminbi's appreciation is the inflow of hot money from the United States and the withdrawal of really useful investments.

The country's foreign exchange reserves are only a buffer zone for China to resist the impact of hot money on China's economy, and slowing down the appreciation of the renminbi is also to drag down the speed of hot money in and out. Every time hot money goes in and out, it takes away a lot of foreign exchange reserves, and China has been preparing for more than a decade to deal with the economic war of the United States, and has stored a large amount of dollars. China's accession to the WTO is a declaration of China's challenge to the United States, and the United States' permission to allow China to join is a challenge letter for the Americans to accept China's love.

The depreciation of the US dollar is the first battle of the United States to attack China, and the slow appreciation of the renminbi is China's defensive war.

It is not yet known who will kill the deer in the end. Whether China can win this silent patriotic war is looking forward to it.

Of course, there is harm, two days ago, who opposed the depreciation of the dollar in the United States! The current foreign exchange reserves are US dollars, and the appreciation of the RMB means that our reserves of 1 US dollar used to cost 9 yuan, and now 1 US dollar is only 7 yuan. How much foreign exchange reserves does China have?

The country's foreign exchange reserves are mostly based on US dollars, and the fall of the US dollar means that the money in the hands of the state is worthless.

After the value-added, the advantages of industrial products are gone, and exports may be reduced.

Other products in the world** are rising, so it means that the yuan has not risen. What you should feel is that the purchasing power of the renminbi has decreased.

Simply put, it means that wages do not rise, and prices are **.

Actually, I still don't understand it, but I think it's beneficial in the long run.

Clear answer: RMB appreciation refers to the appreciation of the RMB exchange rate. There are two meanings about the appreciation of the renminbi, that is, the internal appreciation of the renminbi and the external appreciation of the renminbi.

The so-called domestic appreciation of the renminbi refers to the enhancement of the purchasing power of the renminbi currency, which is measured by economic indicators as a decline in the domestic price level, and the decline in prices is reflected in the price index, such as the most commonly used consumer price index CPI will decline, from the perspective of the common people, it is "money is more spent".

The so-called appreciation of the renminbi refers to the decline in the exchange rate of the renminbi against foreign exchange, which is the reduction of the amount of renminbi that can be exchanged for 1 US dollar under the direct pricing method.

Expansion: The exchange rate is the exchange of the currencies of two countries from a professional point of view, as we all know, since it is the first country, it should follow the law of value, and fluctuate up and down around the value, so from the perspective of the essential requirements of the exchange rate, like other countries, the exchange rate will fluctuate up and down with the change in the supply and demand of the foreign exchange market.

That is to say, the familiar RMB exchange rate has adopted a fixed exchange rate system for a long time in the past, while most major settlement currencies such as the US dollar, British pound, and Japanese yen have adopted relatively large exchange rate fluctuation space.

Renminbi appreciation encyclopedia.

It is easy to lead to inflation, which affects exports and people's consumption levels.

Before the appreciation of the renminbi, the monetary policy of pegging to the US dollar was implemented, that is, when the dollar appreciated, we appreciated, and when the dollar depreciated, we depreciated, that is to say, we have been maintaining a stable and low exchange rate against the US dollar. As a result, it has led to China's successive large surpluses in previous years, and deficits with other countries, under the pressure of various and China's own economic pressure (for example, in order to maintain the stability of the RMB exchange rate and the largest amount of international reserve funds in the market), the RMB monetary policy has finally been adjusted to pegged to a basket of monetary policy, that is, pegged to the currencies of several major countries, so that the RMB began to appreciate.

The above is the history and approximate reasons for the appreciation of the RMB, why does my country not like appreciation? The reason is that our country is in a developing country, the international market accounts for a large part of our income, after the appreciation of the RMB, the advantage of our export goods decreases, resulting in a decrease in exports, shrinking export enterprises, and an increase in unemployed people. But it is not completely without benefits, the appreciation of the renminbi means that the same amount of renminbi can be exchanged for more foreign exchange, which is still beneficial for students who have studied abroad at home, or enterprises that import in large quantities.

In addition, in our consciousness, the yen is very worthless, in fact, this is a wrong concept, Japan was forced by the United States to appreciate to a very high exchange rate, which is very terrible for the economy of Japan, a small country that needs to export more. Why is the yen always a big number? Because the basic monetary unit in China is one yuan, while in Japan it is one hundred yuan.

It is time for the motherland to become stronger

European countries do it on purpose.

Value-added impact:

On the positive side: the fact that a country's currency can appreciate generally indicates that the country's economy is in good shape. Because under normal circumstances, a currency is only likely to appreciate if the economy grows in a healthy and stable manner. This kind of steady and moderate increase in the value of the currency brought about by the good economic situation is extremely attractive to foreign investment.

The rise of the renminbi exchange rate has reduced the amount of local currency required for repayment of principal and interest on outstanding foreign debts, thus reducing the burden of external debts to a certain extent.

An appreciating renminbi can alleviate inflationary pressures and effectively cool down the overheated macroeconomy. Due to the undervaluation of the renminbi exchange rate, a large amount of hot money has flowed into China internationally, causing the economy to overheat and the real estate bubble to expand. The appreciation of the renminbi can effectively solve this problem.

The appreciation of the renminbi is also conducive to industrial upgrading and promoting the reform of China's economic structure, the transfer of industries to poor areas in the central and western regions, and the development of service industries and non-leading industries.

On the downside, the economic effect of RMB appreciation is equivalent to an overall increase in the value of export commodities. The consequence, of course, is that exports are suppressed, which is clearly detrimental to economic development.

A rapid appreciation of the renminbi will reduce foreign direct investment. If the renminbi appreciates, it means that foreign investors will have to pay a corresponding amount of US dollars, and the consequence is that foreign capital will decrease.

will lead to an increase in unemployment. In China, exports account for about 30% of GDP. If the local currency appreciates, export enterprises will inevitably lose money or even go bankrupt, resulting in unemployment, which in turn will increase the hidden danger of social instability.

This will lead to a further expansion of the scale of external debt. With the appreciation of the renminbi exchange rate, it will attract a large amount of capital to flow into China's capital market, so that the scale of China's external debt will increase accordingly.

Affect the stability of financial markets. Most of the funds active in the capital market are international funds, which are large in scale, fast in flow, and strong in profit-seeking, which are the potential factors causing turbulence in the financial market. Under the circumstance that China's financial regulatory system needs to be further improved and the development of the financial market is relatively lagging behind, a large amount of short-term capital flows into the capital market through various channels for profit-seeking behavior, which is likely to trigger a monetary and financial crisis, which will have an adverse impact on the sustained and healthy development of China's economy.

Effect of devaluation:

Positive aspects: if the local currency depreciates, then the purchasing power of foreign currency is strong, so that a certain amount of foreign currency can buy more domestic products, which means that domestic products are relatively cheap in the international market, so that exports can be increased; On the other hand, if the local currency depreciates, foreign goods** will be expensive, so domestic imports will inevitably decrease. The result of the depreciation of the renminbi is to expand exports, curb imports, increase the surplus, and promote economic development.

Disadvantages: The depreciation of the local currency will cause friction to the outside world, which is extremely unfavorable to the stability of the national economy.

Depreciation will not solve the slowdown in external demand, and although depreciation will help exporters survive by reducing costs, it will not be sustainable. In particular, for industries that have lost their competitiveness, the depreciation will only delay the exit time.

What happens if the renminbi appreciates and is on par with the dollar? Does it have an impact on our country?

1. Due to the large elasticity of China's export commodities, the surplus with the United States in the past is likely to be threatened.

2. The US dollar occupies a large share of China's foreign exchange reserve structure, which leads to the shrinkage of wealth.

3. The increase in the international purchasing power of the renminbi may cause capital outflows.

4. There are profit margins in the process of RMB appreciation, and the influx of a large amount of foreign capital tests China's ability to resist risks.

5. The appreciation of the renminbi guides the structure of the production or celery industry and the geographical adjustment.