First, from the perspective of economic factors, the balance of payments, price level, spread, economic growth level, financial situation and foreign exchange reserves have become important factors affecting the exchange rate. The impact of balance of payments. From common sense, if a country's balance of payments continues to be surplus, its exchange rate will show an upward trend; On the contrary, the exchange rate showed a downward trend. China has a continuous trade surplus of 1 1 year. In the first half of 2005, China had a surplus of $67.263 billion in current account and $38.297 billion in capital and financial account. Such a large surplus has led to a continuous and substantial increase in China's foreign exchange reserves, and by September 2005, the balance of foreign exchange reserves had reached 769.004 billion US dollars.
Second, the huge surplus has generated strong demand for RMB, thus giving the RMB exchange rate upward momentum. It is predicted that in 2006, the growth rate of China's surplus will slow down, and foreign anti-dumping against China may further intensify, but overall, the surplus will continue to exist, thus providing considerable support for the appreciation of the RMB exchange rate. The influence of price level. The continuous rise of a country's price level is not conducive to exports, and it is easy to cause a current account deficit in the balance of payments, thus putting some pressure on the exchange rate.
Third, the general price level in China has not fluctuated much in recent years. In 2003 and 2004, the two years with the fastest economic growth, the CPI growth rate was only 1.2% and 3.9% respectively. Since 2005, the overall amplitude of CPI has also been within 2%. If the prices of major products such as grain and oil can remain stable in the future, the overall price level in 2006 should be stable or moderately fluctuating, and the impact of price changes on the RMB exchange rate will not be too great.
Fourth, the impact of the interest rate situation. If the interest rate of one country is relatively higher than that of other countries, foreign funds will flow in, thus pushing up the local currency; On the other hand, if the interest rate in one country is relatively lower than that in other countries, it will depress the local currency. Because the US dollar is the main currency in a basket of currencies referenced by China, and its weight is relatively large, the interest rate difference between China and the United States has a great influence on the RMB exchange rate. In the past five years, the US dollar interest rate has risen steadily. Comparing the yield of one-year US Treasury bonds with the one-year savings deposit rate in China, the yield of one-year US Treasury bonds was 77% in 2005, while the interest rate of RMB was basically stable at 2.25%, with a spread of 0.52%. From this perspective, interest rate is not the most important factor affecting the change of RMB exchange rate. When foreign capital enters China, it pays more attention to the development prospect and potential market of China.
Fifth, if the United States continues to raise interest rates in 2006, the spread will weaken the appreciation of the RMB. The influence of economic growth and fiscal revenue. In 2003 and 2004, China's GDP growth rate remained at 9.5%. In September 2005, China's GDP has reached 106275 billion yuan, and the economic growth rate can be maintained at the level of the previous two years. This kind of economic growth in China should be within the scope of moderate growth. If there are no major emergencies in the international economic and political environment and large-scale serious natural disasters in China in 2006, GDP will still maintain a growth rate of more than 9%.
Sixth, moderate and stable economic growth will promote the appreciation of RMB exchange rate in 2006. By 2005, the fiscal revenue11.28941.90 billion yuan provided an effective guarantee for RMB exchange rate appreciation.