The US dollar exchange rate has risen for four consecutive weeks, approaching 7.3, sellers: profits can be saved

Since the beginning of this year, the U.S. dollar exchange rate has fluctuated greatly, especially in the first quarter. The renminbi has appreciated and the U.S. dollar exchange rate has performed poorly. A number of cross-border sellers have to deal with the sluggish order volume while also facing the problem of declining profit margins due to exchange losses.

Fortunately , after June, the US dollar exchange rate began to rise, and the intraday spot exchange rate of RMB against the US dollar repeatedly fell below the " 7 " mark. Recently, it has been approaching 7.3. The US dollar trend is very good, and there are even many speculations: the US dollar exchange rate is expected to rise to 7.5 .  

The US dollar exchange rate approaches 7.3, and sellers' profit margins rise

Recently, the exchange rate of the US dollar against the RMB has soared, breaking through several important levels of 6.90, 7.00, 7.10 and 7.20. It even broke through 7.25 on June 28, reaching the highest level since December last year , and broke through the 7.25 level again on August 11.

Today ( August 15 ), the spot exchange rate of RMB against the US dollar broke this year's high at 7.2799 after opening, and the lowest intraday was 7.26 and the highest was 7.2875. As of the time of writing, the spot exchange rate of RMB against the US dollar has exceeded 7.2767.

Previously ( June 30), the central parity rate of the US dollar against the RMB reached 7.2699, breaking this year's record and the highest level since November last year (7.3275).

After today's opening, the offshore RMB fell below 7.30 against the US dollar, hitting a new low since November last year.

Industry experts said that the recent weakening of the RMB is mainly related to the weak recent economic data , the high consolidation of the US dollar index and the widening of the interest rate gap between China and the United States.

It is reported that after the United States announced the July PPI index and consumer inflation expectations, the US dollar rose , the US 10-year Treasury yield rose by 3 basis points , and the US dollar index continued to rise above the 103 mark. As of the end of the New York foreign exchange market, the US dollar index rose to 103.191.

In fact, the US dollar has been strengthening since the uptrend began in June this year . The weekly chart of the DXY Dollar Index shows that the US dollar has surged more than 3.2% from its July/year low .

In addition, economists said that the US dollar index still has further upside potential in the short term .

The US dollar exchange rate has returned to the "7" era and continues to strengthen, which is undoubtedly good news for cross-border sellers.

"——Looking at the rising exchange rate, I regretted converting the currency in May and missed out on a lot of profit.

——Hurry up and break 7.5 for me. I don’t care if the order volume is small.

——The Americans should raise the interest rate a little more, up to 8.

——The exchange rate is over 7.2, and I can exchange another 300,000 US dollars.

——I saw the highest exchange rate since I crossed the border , and it was as if I heard the sound of money .

..."

The rising U.S. dollar exchange rate has brought some comfort to U.S. cross-border sellers. "It doesn't matter if the order volume is small. The profit margin is higher than in previous months. I hope the U.S. dollar will maintain such a strong momentum."

Foreign exchange does bring some profit returns to sellers. If the cost of a single product is 100 yuan and the selling price is 30 US dollars, the exchange rate is about 218 yuan at the mid-price of today's press time (1 US dollar : 7.2767 yuan) . One seller said that his net profit per product in August this year was 30 yuan more than in January .

If the seller holds 1 million US dollars, it can be converted into RMB 7.2767 million today at the time of publication. If it is converted at 7.1740 at the closing time on August 4 , it can only be converted into RMB 7.174 million , a difference of RMB 100,000 in 10 days . In the past six months , the US dollar exchange rate has risen from 6.7 to 7.27 today , and only 10,000 US dollars can be exchanged for more than RMB 5,000 when exchanging .

Because it has repeatedly broken through the "7" mark and even approached 7.3, some sellers believe that the USD / RMB exchange rate is expected to break through the "7.5" or even "8" mark . However, many economists said that this is unlikely, " there is no basis for the continued depreciation of the RMB . "

Many sellers hold the same opinion, " 7.5 is difficult, let alone 8. The probability of breaking 8 is lower than falling to 6, and the US dollar exchange rate will fall sooner or later , and it will rebound when it reaches 7.3 ."

"Recently, it is a good opportunity to convert foreign currency into RMB. Don't take risks and be greedy. Although the US dollar exchange rate may stabilize in the near future, there are still risks. The sooner you convert foreign currency into RMB, the sooner you can make money," said a seller.

U.S. consumer power rises, most sellers are optimistic about this year's Q4 peak season

Currently, many American economists believe that the US dollar index will not weaken in the next three months , and the US dollar is unlikely to give up its recent gains in the next few months .

Foreign exchange strategists polled by Reuters also said the dollar will gain footing against most major currencies over the next three months as the resilience of the U.S. domestic economy strengthens expectations that interest rates will remain high for longer.

The strengthening of the US dollar helped sellers to convert foreign currency into cash to “replenish their blood”, alleviating the depressed mood caused by the volume of orders.

However, in the second half of the year, with the improvement of American consumers' spending power and confidence, the order volume of sellers on the US site may improve.

Data from the University of Michigan showed that the U.S. consumer confidence index hit a 22-month high of 71.6 in July . Economists surveyed by The Wall Street Journal had expected the U.S. consumer confidence index to rise to 71.7 in August .

The survey showed that American consumers believe that the economic environment has improved substantially compared with three months ago.

At the same time, there are reports showing that Americans' expectations for overall inflation over the next year have fallen from 3.4% in July to 3.3% in August, showing remarkable stability for three consecutive months. And expectations for inflation over the next five years have fallen slightly from 3% to 2.9%.

As the outlook for the U.S. economy becomes increasingly optimistic, Bank of America economists recently withdrew their forecast that the U.S. economy will fall into recession , becoming the first major Wall Street bank to officially cancel this forecast. Shortly before that, Federal Reserve Chairman Powell also said that the institution no longer predicts that the U.S. economy will fall into recession.

Most U.S. companies also believe that there will be no economic recession this year.

Statistics show that the current unemployment rate in the United States is low , and stable employment and steady wage growth provide American families with funds for continued consumption.

In this context, some sellers launched a survey on social platforms on the "forecast for Amazon's order volume in Q4 this year compared to last year". More than half of the sellers believe that it will increase, more than 35% of sellers believe that it will be the same as Q4 2022, and only 14% of sellers are pessimistic .

Similar to the continuous rise of the US dollar exchange rate , the euro exchange rate is also continuing to recover this year . The British pound has become one of the best performing currencies of the European Group of 10 this year , and the exchange rate to RMB has returned to the "9" era. Many sellers on the UK site also said that they have gained a breathing space for profits, "the order volume is also slowly increasing, the competition is not as fierce as that of the US site, and the exchange rate has also returned. Spring is coming."

The back-to-school season in Europe and the United States has fired the first shot of the peak season in the second half of the year, and the continued rise of the US dollar, British pound and euro has provided sellers with opportunities to settle foreign exchange. In the next period of time, sellers may usher in the double good news of order volume and profit.

Dollar

exchange rate

profit