The rise of RMB exchange rate means that the same amount of RMB can be exchanged for more dollars. On the contrary, the amount of RMB that can be converted into equivalent dollars will be reduced.

The impact of RMB exchange rate rise;

(1) For those China enterprises that export goods to the United States, the increase in exchange rate will mean that if they sell goods in the United States at the same dollar price, then the dollars they get will be converted into less RMB. Because they use RMB to pay employees, buy raw materials, pay utilities, rent and other expenses, and pay taxes to the government. So they have to choose between reducing profits and raising prices. But if the price is raised, it will mean that the competitiveness of its goods in the United States will decline. If the price is not raised, it means that the profit will be reduced or even lost. This may mean that the factory is underemployed or even closed down.

(2) It is good for enterprises that import goods from the United States to China, because it will mean that the cost of goods they buy in the United States at the same dollar price will be reduced when they are sold in China at the RMB price.

(3) For enterprises in China and people in China, the cost of purchasing resources internationally will be reduced accordingly.