The RMB Exchange Rate Is Once Again Approaching 7 After A Year, And Is Expected To Maintain A Relatively Strong Trend in The Short Term.

In the past two weeks, the Chinese yuan has experienced a significant appreciation against the US dollar, approaching the important 7.0 mark for the first time in over a year.

According to Wind data, at approximately 2:20 PM Beijing time on Friday, the RMB exchange rate against the US dollar was 7.0699 yuan per US dollar, a slight decrease of 9 basis points from the previous day's close, but an increase of 468 basis points (0.66%) compared to November 20th. During trading on December 3rd (Wednesday), the RMB exchange rate against the US dollar reached a high of 7.0613, the highest level since October 2024.

Analysts say the recent strength of the RMB exchange rate is the result of a combination of internal and external factors. On the one hand, a weaker dollar and improved Sino-US relations have created a favorable external environment; on the other hand, the Chinese economy has shown strong resilience, particularly with exports consistently exceeding expectations. This, coupled with the strong performance of the A-share market, has increased the attractiveness of RMB-denominated assets, providing significant support for the RMB exchange rate.

Industry experts generally believe that the RMB is likely to remain strong in the short term, but it is unlikely to appreciate beyond 7 against the US dollar before the end of the year.

Looking ahead to 2026, analysts expect a moderate appreciation of the RMB exchange rate to be the primary trend.

Cai Shaoli, a researcher at Huatai Futures, stated in a research report that the RMB exchange rate against the US dollar is expected to continue its upward trend in 2026. The US dollar index is gradually weakening under the influence of easing expectations, and the short-term interest rate differential between China and the US is continuing to narrow. Coupled with a current account surplus and the RMB's reduced sensitivity to external shocks, the RMB has the basis for steady appreciation. "If it successfully breaks through the 7.0 mark, market expectations will be anchored in the 6.8–7.0 range," Cai Shaoli said.

However, analysts point out that whether the RMB exchange rate can break through "7" depends not only on the external trend of the US dollar, but also on the intrinsic strength of the Chinese economy and the stability of its policies. The future trend of the RMB exchange rate may be more inclined towards a new normal of "two-way fluctuations and dynamic equilibrium," rather than a one-sided trend.