The turmoil of RMB devaluation, the truth behind the strong dollar and the future outlook of RMB

Hey, everyone, have you been flooded with news about the "significant depreciation of the RMB exchange rate" recently? Don't worry, let's first sort out what's going on.

1. The depreciation of the RMB is actually due to the over-strength of the US dollar

First of all, we have to understand that exchange rates are relative. If you say that the RMB has depreciated, it is actually relative to the US dollar. Recently, the offshore RMB exchange rate against the US dollar has fallen below 7.3 and 7.31, which is really scary. But in fact, this is not just about the RMB, but also because the US dollar is too strong!

You see, the euro against the US dollar has also fallen below 1.05, hitting a recent low; the Indian rupee against the US dollar has even hit a new historical low, with 1 US dollar being exchanged for 84.6 rupees. The US dollar is simply the "dominant force" in the global currency world, and everyone bows to it.

2. Why is the US dollar so strong? Because it is still a "hard currency"

At this point, you may ask, why is the US dollar so powerful? Actually, the reasons behind this are quite complicated. But to put it simply, the US dollar is still the undisputed world currency. Whether it is places like North Korea and Syria, or big countries like the Democratic Republic of the Congo and Russia, everyone uses the US dollar for settlement and believes in the value of the US dollar.

The US dollar is like what we usually call "hard currency", which can be exchanged for something wherever you go. Therefore, when the US dollar is strong, other currencies appear "weak", and the RMB is no exception.

3. Can the RMB replace the US dollar? Don’t rush, take your time

Now, you may ask again, can the RMB replace the US dollar in the future? Well, we have to take our time and not rush. If we want the RMB to become the "new overlord" of the global currency world, we have to do three things:

1. Stronger military strength than the United States: This is not just talk, it requires real weapons. However, China's current military strength should not be underestimated and is making steady progress.

2. Stronger economic strength than the United States: This is needless to say. China's economic development speed is obvious to all the world. Although it has not surpassed the United States yet, the gap is gradually narrowing.

3. The country's credibility is stronger than that of the United States: This is actually quite crucial. If a country wants its currency to become a global currency, it must make everyone trust it. China has always adhered to the principle of honesty and trustworthiness, and its international reputation is getting better and better.

Therefore, if the RMB wants to replace the US dollar and become the new global currency "hegemon", it has to take it slow and take one step at a time. This is not something that can be accomplished overnight, and it requires the joint efforts of all Chinese people.

4. Don’t panic, the RMB also has its “little happiness”

However, although the RMB is a little "weak" compared to the US dollar, there is no need to panic because the RMB also has its own "little happiness".

You see, China's economy has been growing steadily, and its international status has been continuously improving. Moreover, we have huge foreign exchange reserves and a stable financial market, which are the "strong backing" of the RMB. Therefore, we should still have full confidence in the future of the RMB!

5. Conclusion: Exchange rate fluctuations are the norm, and a rational approach is the key

Well, let's stop here today. Finally, I want to tell you that exchange rate fluctuations are actually normal. We don't need to panic because of temporary fluctuations. On the contrary, we should look at this rationally and keep a calm mind. After all, China's economic strength and international status are here, and the future of the RMB will definitely be getting better and better!

So, my friends, don't panic, let's wait for the "rise" of the RMB together! #NFT市场回暖