Since the beginning of the year, although the overall exchange rate of RMB against the US dollar has strengthened, exports have remained high. In response, Yu Bo, chief macro analyst at Cathay Pacific Haitong, said that the appreciation of the RMB against the US dollar is not equal to the simultaneous appreciation of all trading partner currencies; weak domestic inflation is also buffering actual appreciation pressure. The shift of exports to more technologically advanced and less replaceable commodities, combined with natural hedging formed by imported intermediates, weakens the sensitivity of exports to exchange rates. RMB settlement and foreign exchange hedging are becoming increasingly popular, reducing the transmission of exchange rate fluctuations to business operations. The moderate appreciation of the RMB will not affect export resilience. Historical exchange rates have risen along with market share, more due to increased industrial competitiveness.

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