On September 25, the offshore RMB against the USD regained the 7.0 mark, reaching as high as 6.9993, marking the first time since May of last year. On the same day, the onshore RMB exchange rate rose by 167 points against the USD, with both rates hitting over 16-month highs. Over the past three months, the RMB exchange rate has risen nearly 4%.
On the same day, onshore equity assets also saw a significant surge. Behind this wave of surge is the booster injected into the market by regulators. On September 24, the People’s Bank of China launched three major actions: comprehensive reserve requirement and interest rate cuts, a reduction in mortgage interest rates for existing properties, and an 800 billion yuan special fund for the stock market.
However, the rapidly rising RMB exchange rate has caught exporters off guard, leading to frequent settlement waves. According to market insiders, whether exporters can manage exchange rate risks in the future depends on their ability to expand the use of RMB in transactions, which is closely linked to the internationalisation of the RMB.
