In The Past Three Years, The Appreciation Of RMB Has Appreciated More Than 21% Against The US Dollar.

July 21st marks the 3rd anniversary anniversary of the reform of the RMB exchange rate regime.

The people's Bank of China authorized the China foreign exchange trading center to announce 21, the interbank exchange market RMB to the US dollar exchange rate intermediate price is 1 US dollars to 6.8271 yuan.

On this basis, the appreciation of RMB against the US dollar has exceeded 21% in the past 3 years.

In July 21, 2005, China announced the reform of the RMB exchange rate formation mechanism. Instead of focusing on the single dollar, it managed a managed floating exchange rate system with reference to a basket of currencies.

Since the reform, the exchange rate of RMB against the US dollar has continued to rise slightly, and the two-way fluctuation characteristics of "rising and falling" are also obvious.

A notable feature since 2008 is the accelerated pace of appreciation of the RMB against the US dollar, which has risen by nearly 7%, more than the annual increase of 6.90% last year.

At the same time, the elasticity of RMB exchange rate has been increasing. The floating rate of non US dollar currencies to RMB trading price has expanded to 3% in the inter-bank spot foreign exchange market.

The average volatility of the RMB against the US dollar has expanded from 17 basis points in 2005 to the end of the year to more than 60 basis points.

In the past 3 years, China's exchange rate reform has always adhered to the principle of initiative, controllability and gradualism, and has been pushing deeper. From the point of view of practice, the effectiveness of exchange rate reform is moving towards the expected goal, and the related risks are gradually being controlled in the process of improving the exchange rate mechanism.

Since the reform of the exchange rate, the impact of exchange rate on improving trade imbalance, promoting industrial upgrading and expanding domestic demand has become increasingly apparent.

At the same time, the structure of China's export commodities has also been optimized. The proportion of labor intensive products such as textiles and footwear and energy products in export products has declined, and the export of mechanical and electrical products has increased steadily.

However, the process of economic restructuring and industrial optimization and upgrading will inevitably mean a gradual decline of some non competitive industries.

Under the background of RMB appreciation, clothing, footwear and other traditional export industries in China are particularly stressed. Inevitably, some enterprises fail and withdraw from the market, and accelerate the integration in the industry.

For such enterprises, simply relying on the development mode of low price and quantity expansion is no good policy. It is wise to strive to improve the added value of products, improve product grades and enhance brand awareness.

Because of the imbalance of regional development in China, it is possible for this kind of industry to realize industrial pfer and turn from the eastern region to the central and western regions.

Practice has proved that most of the enterprises that can actively respond to the appreciation of the renminbi can gain greater market share and faster profit growth.

Many enterprises continue to develop and pform through internal tapping the potential and avoiding financial risks.

Since the exchange reform, with the continuous appreciation of the RMB against the US dollar, the accelerated inflow of short-term speculative capital has also attracted wide attention from all walks of life.

In response to this risk, many ministries and commissions in China have recently begun to supervise the flow of funds in areas such as trade and direct investment, and jointly block the inflow of hot money and guard against the sudden withdrawal of short-term capital.

Since July 14, 2008, the State Administration of foreign exchange, the Ministry of Commerce and the General Administration of customs have jointly implemented the online verification of export collection and exchange. The development and Reform Commission has also issued a document recently, requiring all localities to strengthen and standardize the management of foreign investment projects.

These two measures aim at monitoring the inflow of hot money under Trade and direct investment projects, thereby preventing potential inflow of foreign exchange capital from bringing potential risks to China's healthy economic development and balance of payments.

In the first quarter monetary policy implementation report, the people's Bank of China pointed out that it will continue to improve the managed floating exchange rate system in accordance with the principles of initiative, controllability and gradualism.

We should speed up the pformation of economic development and foreign trade growth mode, increase structural adjustment, further enhance the pulling effect of domestic demand on the economy, and optimize the structure of import and export commodities.

The path of exchange rate reform has gone through three years. It is foreseeable that the continuous improvement of the exchange rate system will effectively promote the sound and rapid development of the national economy.