RMB 7 Textile Companies Said They Had Psychological Preparation.

Original title: RMB exchange rate breaking 7, good for the overall foreign trade, but for the industry, more is the impact of psychological expectations.

In August 5th, the RMB depreciated against the US dollar, breaking through 7 yuan.

About 7 of the RMB, Xu Hui, the manager of a large garment manufacturing enterprise in Anhui, said to the first financial reporter that he had already been prepared.

However, the lock up measures that his company has already done may be temporarily affected by the book changes due to the latest exchange rate changes.

"In June, there was a trend in the market that the exchange rate would fall from 6.8 to 6.5, so the company would lock in 6.7~6.8 and lock it back last week." Xu Hui said.

In Xu Hui's view, the company's move to lock the exchange rate to 6.9 at the beginning of this year was "earned". Generally speaking, lock remittance will be 4~5 months ahead of schedule, and the exchange rate of 5~6 will be between 6.7~6.8 this year. But recently, though he reminded many times in the company group that he did not lock the remittance again, he failed to prevent the company from changing the lock up arrangement ahead of schedule.

Unlike Xu Hui's company, Li Changchun, manager of Wujiang Weihua Textile Co. Ltd., told the first financial reporter that the company did not adopt the measures of lock up because of its small export scale in recent years.

Li Changchun said that the RMB exchange rate broke 7, which is good for the overall foreign trade, and more for the industry is just the impact of psychological expectations.

Li Changchun believes that on the one hand, foreign businessmen themselves are very smart. In the face of the devaluation of the renminbi, they naturally have "psychological number" when making quotations, and will adjust their quotations accordingly.

On the one hand, although depreciation will give Chinese products an advantage over foreign products in the international market, the competition among domestic counterparts is more important for the textile industry. Therefore, he believes that the impact of devaluation on the textile industry is relatively limited.

Xu Hui told the first financial reporter that as part of the textile companies were rushing to ship in the first half of last year and the first half of this year, orders for the United States increased, but personal data is expected to recede in the second half of this year and the whole year.

According to customs statistics, in the first half of this year, China's imports and exports to the United States amounted to 1 trillion and 750 billion yuan, down 9% compared to the same period last year, of which exports to the United States were 1 trillion and 350 billion yuan, down 2.6% compared to the same period last year. Imports from the United States decreased by 399 billion 380 million yuan, down 25.7% compared to the same period last year, and the trade surplus was 954 billion 810 million yuan, expanding 12%.

On July 12th, the Information Office of the State Council held a press conference. The spokesman for the General Administration of customs and director of the statistical analysis Division, Li Kai Wen, introduced the import and export situation in the first half of 2019, and said that although the bilateral trade data declined, the overall import and export figures of China's foreign trade continued to grow, and the potential of the Chinese market was still highly valued by the whole world.

In response to the changes in the foreign trade situation and domestic production costs, Xu Hui's company has built factories in Kampuchea 5 years ago. However, because the local manufacturing advantages are not as obvious as those in China, in recent years, factories have been transferred to others for operation, and other considerations have been made.

The market is still changing, and the possibility of RMB depreciation and appreciation exists simultaneously.

Xu Hui said that although he personally did not support the continued lock up, the company also did not rule out the fact that it would continue to lock in to make a wait and see, because the outcome of the next negotiation could also turn better. Once the proposed 10% tariff was abolished, the renminbi could resume its appreciation.

Instead of focusing on exchange rates, companies need to focus more on physical businesses, which is also what officials want to convey.

Responding to questions raised by the people's Bank of China today, the responsible person of the people's Bank of China also said that today the RMB has depreciated against the US dollar and has broken through 7 yuan, but the renminbi has remained stable and strong for a basket of currencies. This is a reflection of market supply and demand and international exchange market volatility.

The official stressed that enterprises do not want to expose too much to exchange rate risk, and support enterprises to purchase exchange rate hedging products to avoid exchange rate risk. At the same time, we should also see that the RMB exchange rate is likely to depreciate or to appreciate. The two way floating is normal. It is not only for enterprises, even more professional financial institutions, can hardly predict the trend of exchange rate.

The person in charge suggested that we should focus on the entity business, instead of focusing too much energy on judging or opportunistic exchange rate trends. We should set up a financial concept of "risk neutral". We should aim to lock in foreign exchange costs, reduce the uncertainty of production and operation, and realize the main business profit.

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