Recently, I’ve been watching the trend of the USD to RMB exchange rate and have noticed some quite interesting phenomena.

Do you remember the depreciation wave in 2022? The RMB fell from 6.35 all the way to above 7.25, marking the largest decline in recent years. At that time, the Federal Reserve was aggressively raising interest rates, the US dollar index soared, and with domestic economic pressures, market confidence in the RMB was very low. But since last year, the situation has gradually reversed.

In 2025, the RMB performed quite resiliently, with the USD to RMB fluctuating between 7.1 and 7.3, appreciating 2.4% over the year, and by November, it even dropped below 7.08. The logic behind this is clear: US-China relations eased, the Federal Reserve began signaling rate cuts, and the dollar index shifted from strength to weakness. These factors combined, and the RMB gradually emerged from its previous difficulties.

Now it’s mid-2026, and looking back at predictions from international investment banks, some have already come true. Deutsche Bank said the RMB would rise to 7.0, Morgan Stanley forecasted around 7.05 by the end of 2026, and Goldman Sachs was even more aggressive, believing it would break below 7. From the current trend, these predictions are basically on track.

I think the key still lies in understanding the logic behind the USD to RMB exchange rate. China’s export resilience is good, foreign capital is reallocating RMB assets, and the structural weakness of the dollar index supports the RMB. But short-term fluctuations will definitely still occur, mainly depending on the Fed’s pace of rate cuts, progress in US-China trade negotiations, and the central bank’s guidance on the RMB’s midpoint rate.

From an investment perspective, the volatility of the USD to RMB exchange rate actually presents some opportunities. If you believe the RMB will continue to appreciate, you can participate through forex trading. However, to be honest, the forex market carries risks, and leverage trading requires caution. The most important thing is to understand the macro factors driving exchange rates—central bank monetary policies, economic data, dollar trends, and official exchange rate guidance—these are fundamental.

For example, if the central bank continues to inject liquidity to support economic recovery, there might be short-term pressure on the RMB to depreciate. But if the economy stabilizes, it will be beneficial for the RMB in the long run. Conversely, the Fed’s policy is also crucial; if inflation remains high, they might slow down rate cuts, causing the dollar to rebound.

The current market generally believes that the RMB has exited a long depreciation cycle of several years and has entered a new appreciation trend. But this isn’t a straight line upward; there will definitely be bumps along the way. The key is to grasp the major directions affecting the exchange rate, rather than focusing on daily ups and downs. For investors interested in forex trading, choosing a reputable platform, setting reasonable leverage, and managing risks well are the keys to success.