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Lu Commissar: Export Prices Can Buffer Appreciation Pressure

2011/3/15 14:33:00 56

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With the continuous appreciation of the RMB against the US dollar, although the concerns of Chinese scholars are increasing with regard to whether the Chinese enterprises can afford to carry them, the data at the export level of the enterprises are in excess of expectations.

The people's Bank of China announced "further deepening" in June 19, 2010.

RMB rate

After the formation mechanism reform, the appreciation of the RMB against the US dollar increased by 3% at the end of the year according to the middle price, but since July 2010, the highest export growth in the single month has reached 38.1% (July 2010), and the lowest growth rate has been 17.9% (December 2010). The average growth rate of exports between July 2010 and January 2011 is 31.9%, which is still quite amazing, showing that the compression strength of the foreign trade enterprises seems to be much stronger than people think.

Senior economist, Societe Generale Securities

Lu commissar

There are two main reasons for this: first, when the RMB appreciates rapidly against the US dollar, the effective exchange rate of RMB is generally relatively stable. Second, in the face of the appreciation of the renminbi, China's export enterprises are also forced to start raising prices, which has greatly buffered the appreciation pressure on Corporate earnings.

Since September 2009, with the increase of import prices, Chinese enterprises have been forced to raise the prices of export products. During the period, although the prices of imported products dropped to the peak after June 2010, the export price has not stopped. The latest increase in export prices has reached 11% in the latest January 2011.

Export price

Since the data, the third highest monthly increase has been only one step away from the highest historical increase of 11.9% (February 2008).

Lu political commissar judged that, given other conditions, if the price increase of future export products can be maintained at the current year-on-year increase, it is clear enough to hedge against the increase in the RMB 5-6% against the US dollar. "In this case, we should pay close attention to the pfer of orders to other countries in the future."