On February 26, the RMB against the US dollar continued its appreciation. Both onshore and offshore RMB broke above the 6.86 level, hitting a 34-month high and recording a fourth consecutive gain. The strong performance reflects improving attractiveness of RMB assets amid a recovering domestic economy, a weaker US dollar, and returning foreign capital.

This round of appreciation is supported by multiple factors. First, the domestic economy is steadily recovering, with improving industrial production and consumption data and resilient foreign trade, providing a solid fundamental foundation for the exchange rate. Second, the US dollar index continued to weaken, falling below the key level of 97.80, as market expectations of Federal Reserve rate cuts rise, reducing the appeal of the dollar. Third, foreign capital continued to flow into A-shares and the bond market, with cumulative northbound inflows expanding since the start of the year, driving the exchange rate and asset prices higher in tandem.

A stronger RMB has multiple impacts on the market and household consumption. Import companies face lower raw material costs, benefiting industries such as aviation, papermaking, and cross-border e-commerce. Overseas travel, studying abroad, and cross-border online shopping become more cost-effective, reducing cross-border consumption expenses for residents. For export enterprises, hedging and product upgrading are needed to manage volatility and stabilize operational expectations.

Industry insiders note that the medium-term trend of the RMB will return to economic fundamentals. With sustained economic recovery and effective policy support, the attractiveness of RMB assets is expected to remain strong. Future attention should be paid to Federal Reserve policy directions, domestic economic data, and cross-border capital flows, with the exchange rate expected to remain generally stable at a reasonable and balanced level.