China Will Also Catch Cold When It Hits The Ground.
This is an American patent for one hundred years.
Until today, if we look at the economic and financial influence of all countries in the same way objectively, China can not be ashamed to say that today, China will also catch cold with the world.
A few days ago, the US Treasury Secretary Geluk and the director of the central finance and economics group office, Liu Hetong, spoke on the US's most dry goods.
President Xi Jinping also proposed to avoid competitive currencies in September last year.
depreciation
It is welcome that the US side will welcome exports without the devaluation of the renminbi.
In the vernacular, the United States once again reminds us that we must count our words and that the Renminbi should not be depreciated.
This week, the world stock market and foreign exchange market have been greatly affected, while China includes Hongkong stock market.
Currencies
Help intensify the strength of billows and waves.
Is the world in financial crisis again? The stock market crisis? Will China's stock market crash increase? This is certainly related to the US economy and finance, but the Chinese factor is more direct and even more important.
Investors also need to understand the impact of China's RMB exchange rate and Shanghai and Shenzhen stock markets on China and the rest of the world.
Although the total amount of GDP calculated according to the current exchange rate is US $17 billion, China is US $10 trillion, which is about 70% of the US.
But in terms of the main indicators of the real economy, such as the total manufacturing industry, the total volume of new GDP, the volume of import and export trade, the consumption demand of bulk commodities such as iron and steel, and foreign exchange reserves, China is going beyond the US in terms of scale.
What is particularly important is that the United States is the largest trade deficit country in the world, with a trade deficit of 400 billion dollars per month. The stable balance of payments in the United States, that is, the stability of the US dollar, depends on international capital inflows, including Chinese students, Chinese mothers buying famous brands, buying American houses and so on.
On the contrary,
China
The largest trade surplus country in the world, in 2015, China exported 22765 billion US dollars and imported 16820 billion US dollars, with a surplus of US $594 billion 500 million for the whole year, with an average monthly surplus of more than 400 billion US dollars.
That is to say, from simple data projections, the stability of China's RMB exchange rate can bear the outflow of $40 billion a month, or the pressure on RMB to appreciate.
If capital outflows exceed US $40 billion a month, the renminbi will be devalued under other factors.
The above is a big pattern of trade and capital exchanges between China and the United States. It is the basis for stability of the US dollar and RMB and the stability of world finance.
If the RMB depreciates, the trade imbalance between China and the United States will intensify, and the US export and economic recovery will inevitably suffer a negative impact on the balance of payments. The US stock market and the US dollar index will also be dragged down, which in turn will have a negative impact on China's foreign exchange market and stock market.
The US dollar exchange rate index has been hovering at 99 points since it reached its 100 peak in late November. It has not shown a strong trend in the US economic data. The United States raised its interest rate for the second time at least in time.
In this regard, the US's concern about the stability of the RMB exchange rate is very urgent.
The United States is so, not to mention other countries, the world has quietly entered a new era with Chinese symbols.
China's stock market, RMB exchange rate and interest rate are no longer the follower of the international financial market.
Of course, we must grasp the dynamics of the international financial market, but more importantly, we have an objective and fair understanding and judgement of China's own economic and financial situation, so that we can make good investment decisions.
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