Foreign exchange dumping is to devalue the domestic currency. The principle is that if the domestic currency depreciates, the price expressed in foreign currency will be lower than before, which will improve the competitiveness of domestic products abroad; When foreign goods are imported into China, the prices expressed in local currency are higher than before, which reduces the competitiveness of foreign goods in China. So as to promote exports and curb imports.

Conditions: first, the implementation of foreign exchange dumping should ensure that the degree of currency depreciation is greater than the level of domestic price increase, so that domestic prices remain unchanged or have little change, and exports to foreign countries still have advantages.

Second, we must ensure that other countries do not implement the same degree of foreign currency depreciation policy or other retaliatory policies (such as restricting the import of goods, etc.). )

Third, the external devaluation of the currency should be carried out without domestic inflation. That is, the external devaluation is less than the internal devaluation of the currency, otherwise it will aggravate the degree of inflation.

Fourth, the commodities targeted by currency depreciation are commodities with greater demand elasticity, so that the increase in demand can greatly increase sales and thus increase foreign exchange income.