What do you mean by RMB depreciation? What impact will it bring?

RMB depreciation, that is, currency depreciation (also known as devaluation, which is the symmetry of currency appreciation), in professional terms, refers to the decline of the value contained in or represented by the unit currency, that is, the decline of the unit currency price; In the most popular words, the purchasing power of RMB is weakened, or money is valuable

1. The devaluation of RMB, that is, currency devaluation (also known as currency devaluation, which is the symmetry of currency appreciation), in the professional words, refers to the decline in the value contained in or represented by unit currency, that is, the decline in the price of unit currency; In the most popular words, the purchasing power of RMB is weak, or money is valuable. For example, at present, 6.3654 RMB can be exchanged for 1 US dollar. If the depreciation rate is 5%, 1 US dollar after depreciation can buy 12.738 RMB, or 6.3654 RMB can buy .5 US dollar.

2. So, if RMB depreciates, what impact will it have on our people (individuals)? The devaluation of RMB will first make the RMB exchange rate fall (with the central parity of RMB against the US dollar as the reference value), then affect the national macro-economy, and finally reflect the changes in the overall situation (national macro-economy) on the lives of our people (individuals).

RMB depreciation generally includes active devaluation and passive devaluation. Generally speaking, the active devaluation of RMB is that the central bank of China actively adjusts the central parity of RMB against the US dollar according to the current macroeconomic situation to reflect the devaluation. Active devaluation is a national macroeconomic means, which is beneficial and harmless to most of us in the overall situation at home. The passive depreciation of RMB generally refers to the sharp appreciation of other countries' currencies (generally referring to the US dollar), which leads to the automatic increase (passive increase) of the central parity of RMB against the US dollar, so that the purchasing power of RMB weakens and depreciates.

The depreciation of RMB will hurt the interests of the following categories of people (industries):

(1) Shareholders in the stock market. In fact, most of the movements of RMB and A shares are highly correlated. If the RMB depreciates, many people will consider changing their money into dollars, which may lead to a rapid decline in A shares. This is because the depreciation of RMB will lead to a decline in the valuation of local currency assets, which will lead to the weakening of the relevant sectors of the financial industry (including real estate), which will even drag down the overall market and damage investors. On the other hand, once the expectation of RMB depreciation is formed, it will lead to the outflow of hot money, and the capital market where A shares are located will tighten rapidly, resulting in the loss of shareholders. Thirdly, if the RMB depreciates sharply, it may make overseas financing enterprises bear a heavy financial burden, which will reduce the valuation of related stocks and thus "cut the meat" for sale.

(2), outbound group (traveling abroad or studying abroad). For students who go abroad to play or study in the United States, it means that the same RMB is exchanged for a lot less dollars than before, which will cause financial constraints for those who go abroad. For these people, you can buy foreign exchange first, that is, consider changing all the cash (US dollars) you need before going abroad. You can also bring several credit cards (UnionPay, VISA and MasterCard) for use, because many people like to use credit cards for shopping when traveling abroad. If the RMB is depreciating, it is relatively cost-effective to use credit cards settled in US dollars, but you can still pay less if you delay repayment. If you use a credit card settled in RMB, if the RMB continues to depreciate, you will pay more interest.

(3) Haitao people in China. In recent years, the overseas purchasing market is extremely hot. The prices of goods purchased from overseas Haitao are generally about 1/3 cheaper than those purchased at domestic counters, and some are even half cheaper. This is also the reason why many Haitao people are far away. However, if the RMB depreciates, many Haitao people will "lose money". For example, if a commodity with an original value of 1 US dollars (equivalent to about 636.54 yuan) is purchased from overseas, if the RMB depreciates by 5% (exaggeration, easy to understand), it will cost 1273.8 yuan to buy it. It's like a catty of cabbage in 3 yuan, and it's obviously unfavorable that you have to pay 6 yuan to buy it after the RMB depreciates. Of course, it will be beneficial for foreigners to find China products at this time.

Let's analyze how the devaluation of RMB will affect individuals from the overall situation:

We all know that the advantages and disadvantages are relative. If it is good for some people, it will be bad for others. Just like import and export enterprises, RMB depreciation is beneficial to export enterprises, which at the same time inhibits the development of import enterprises. At the same time, good export enterprises will be good for employees engaged in export industries, such as double wages; Of course, when the import enterprises are suppressed, the life of the employees working in the import enterprises will face difficulties. Of course, the devaluation of the renminbi, according to the meaning of "money is worthless", sounds like a good thing or a bad thing, just like going to the vegetable market to buy a catty of cabbage would cost 3 yuan, but after the devaluation, it would cost 6 yuan to buy it. If you are an ordinary farmer in China, your income can only depend on planting, and there is little land, which will lead to the phenomenon of "not enough to eat". Of course, the state has considered this situation. For this kind of people, the state has adopted "subsidies" to make our lives more interesting.

(1) The devaluation of RMB will benefit the following categories of people (industries) or those engaged in the following export industries:

A. Textiles and clothing. The devaluation of RMB will give many domestic export-oriented enterprises a breathing space. Among these export-oriented enterprises, textile and garment enterprises undoubtedly occupy a considerable proportion. For textile and garment enterprises whose profits are swallowed up by foreign exchange settlement, RMB depreciation will be one of the most direct means to stimulate their performance growth.

B. steel industry. Going abroad is an effective way to increase the profits of steel enterprises, especially in the case of RMB depreciation, which undoubtedly enhances the competitiveness of related steel enterprises.

C. shipping industry. The depreciation of RMB will stimulate the export of domestic textile and other industries, which will bring some benefits to container shipping, thus stimulating the demand for raw materials to drive the air freight market.

D. purchasing industry. The depreciation of RMB will increase the procurement cost of importing enterprises, but it will be good for export-oriented chemical enterprises.

e. automobile industry. The depreciation of RMB may make the price of imported cars less attractive, thus inhibiting the further expansion of imported car sales.

(2) The depreciation of RMB will affect investors (such as spot, futures, foreign exchange, etc.).

a. The depreciation of RMB is reflected in the exchange rate of US dollar, which directly affects the fluctuation of silver price under certain circumstances. Generally speaking, in the spot silver market, the price of silver falls when the dollar rises (RMB depreciates), and the price of silver rises when the dollar falls (RMB appreciates). Spot investment can buy up and down. If the RMB depreciates, it may become rich overnight for those who buy in the right direction. If the direction is reversed, it may be ruined.

b, the strong dollar (RMB depreciation) generally means that the domestic economic situation in the United States is good, domestic stocks and bonds in the United States will be sought after by investors, and the function of spot silver as a means of value storage will be weakened; The decline in the exchange rate of the US dollar is often related to inflation and the stock market downturn, and the value-preserving function of spot silver is once again reflected. This is because the depreciation of the dollar is often related to inflation, while the value of spot silver is high, which will often stimulate the preservation and speculative demand for spot silver when the depreciation of the dollar and inflation intensify. The dollar is strong and silver is weak; Silver is strong and the dollar is weak.

C. Futures are mainly not goods, but they can be reflected through trade. There is a correlation between the depreciation of RMB and the deterioration of terms of trade, and the expansion of export volume has aggravated the deterioration of terms of trade.

d, the impact of RMB depreciation on foreign exchange traders.

since foreign exchange is a bilateral transaction, traders can buy a currency pair contract as the beginning of the transaction, or sell a currency pair as the beginning of the transaction. Similarly, they can buy or sell a currency pair as the end of the transaction. Whether it goes up or down, it is possible to achieve profitability. That is to say, if the RMB depreciates, people who buy in the right direction may get rich overnight, and if the direction is reversed, they may lose all their money.

(3) Other effects of RMB depreciation.

For a long time, a large number of foreign capitals have wandered around China and earned a lot of money from China. Someone once told such a joke: An American ate and drank in China, and when he left, he changed the remaining money into dollars. After one year, he wanted to eat and drink freely in China. In theory, a large amount of US dollars will enter China and be exchanged for RMB assets to avoid the relative depreciation of US dollars. After these dollars enter, they exist in the form of certain assets. Most of them are buying real estate. One of the reasons for the sharp rise in house prices in the past few years is that the RMB continues to depreciate. In this process of depreciation, people who own real estate have a rapid appreciation of their assets, but this is not necessarily a good thing. Because, if the RMB depreciates, some investors are worried that assets will be withdrawn from the real estate, especially those funds that poured into China from overseas in the early days, which will flow out of China due to the depreciation of the RMB, or they will not dare to enter the China market easily again, which will help the domestic housing asset prices to fall again.