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CCTV's 'Yuyuan Tantian': Status of USD Changing; RMB Standing at New Starting Point
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On February 12, both USD/ CNY and USD/ CNH surpassed the 6.9 mark, reaching the highest level in 33 months since May 4, 2023, as the news account "Yuyuan Tantian" under CCTV said in an article. One background for the RMB appreciation is the weakening of the USD itself, but more importantly, there has been a change in external expectations for the Chinese economy. In early 2025, in wake of US tariff threats, the international market cast doubts on the Chinese economy. However, as China's countermeasures became more resolute, especially in April when China became the first country to counter the so-called "reciprocal tariffs" imposed by the US, market expectations shifted from concern to trust. Moreover, macro policy deployment, FX rate lag effects, and enhanced industrial competitiveness all underpinned the RMB. The article also mentioned that the use of RMB in cross-border trade settlements is expanding; foreign investors are generally increasing their holdings of RMB-related assets; more issuers are beginning to consider RMB as an optional financing currency; and more countries are weighing RMB as part of their diversified reserve currencies, therefore the credibility of the USD is wavering, its monetary status is changing, and multiple currencies are replacing the USD's status. AASTOCKS Financial News Website: www.aastocks.com |
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