It's time to guard against excessive RMB exchange rate adjustments

With the final chapter of the US presidential election now written and President-elect Donald Trump's strong return to politics, market concerns are rising that the United States might again implement policies that could weaken the Chinese yuan, or the renminbi.

In early 2018, the Chinese renminbi's rebound was stopped by then US president Trump's initiatives to escalate US-China trade tensions. The Chinese currency briefly tested the 7 per dollar mark at the end of 2018 and mid-2019 and finally broke below that level in August 2019. This is what could be considered Trump 1.0's impact on the yuan.

During the 2024 election campaign, Trump threatened to impose high tariffs on goods directly or indirectly exported from China to the United States.