Offshore RMB fell below 7.2 against USD

       The rapid decline of the RMB exchange rate against the US dollar is not a good thing. Now A-shares are also in a slump. Be careful that the foreign exchange market and the securities market overlap to form a double kill situation. The dollar is very strong against the currencies of other countries in the world, including the British pound and the Japanese yen. To be honest, it is difficult for the RMB to be independent, but if the exchange rate falls too fast, it may be a dangerous signal.
        At the beginning of September, the central bank has reduced the foreign exchange reserve ratio and released the liquidity of the US dollar, in order to reduce the pressure of the decline of the RMB exchange rate. Yesterday, the central bank raised the foreign exchange risk reserve ratio to 20%. Together, these two measures are the measures taken by traditional Chinese medicine to intervene in the exchange rate in the foreign exchange market. But I didn’t expect that the US dollar would be so strong, and it would advance rapidly all the way.
       Although we did not want to appreciate the RMB quickly in the past, maintaining a relatively stable exchange rate can help our manufacturing and marketing in China worldwide. The RMB exchange rate has declined, which is more advantageous for the price competitiveness of Chinese goods in the world. But if it drops rapidly, the risks will be far greater than the export benefits.

       We are now implementing a loose monetary policy, which is not synchronized with the policy of the Federal Reserve’s icon, and only further increases our pressure. In the future, it seems that the central bank and even higher level management departments should provide systematic support to China’s financial markets, especially the foreign exchange market and the securities market, otherwise the risk accumulation will become larger and larger.