Guan Tao, chief economist at Huafu Securities, said on Oct. 9 that since the RMB hit a trough vs the dollar in mid-April last year it has strengthened to about 6.70 per USD, a cumulative appreciation of roughly 10% from the low. He attributed the move to firm exports, trade-surplus-driven FX supply and stronger market confidence as the economy shifts toward higher-quality growth. The yuan has appreciated in both bilateral and effective terms: BIS nominal and real effective exchange rates rose 4.

Guan Tao, chief economist at Huafu Securities, said on Oct. 9 that since the RMB hit a trough vs the dollar in mid-April last year it has strengthened to about 6.70 per USD, a cumulative appreciation of roughly 10% from the low. He attributed the move to firm exports, trade-surplus-driven FX supply and stronger market confidence as the economy shifts toward higher-quality growth. The yuan has appreciated in both bilateral and effective terms: BIS nominal and real effective exchange rates rose 4.7% and 7.4% from May last year to Aug this year. China’s export price index averaged 105.32 in the first eight months of the year, implying average YoY export price gains above 5%, which increases the price contribution to export growth and further confirms that recent trade gains reflect improved industrial international competitiveness.