On December 16th, the exchange rate of the Chinese yuan against the US dollar continued to soar. The onshore RMB to USD exchange rate is approaching the 7.04 yuan mark, while the offshore RMB to USD exchange rate has risen above the 7.04 yuan mark, both reaching new highs in 14 months. Experts say that recently, benefiting from the overall weak external environment of the US dollar and the good performance of the domestic equity market to attract foreign investment, the exchange rate of the RMB against the US dollar has shown a stable and upward trend. Looking ahead, the RMB exchange rate against the US dollar is expected to remain relatively strong in the short term and is expected to maintain a moderate appreciation in 2026. On December 16th, the Chinese yuan strengthened again against the US dollar, reaching a new high in 14 months. According to Wind data, as of 16:30, the spot closing price of onshore RMB against the US dollar was 7.0425 yuan, up 80 basis points from the previous closing price. The highest intraday price was 7.0416 yuan, reaching a new high since October 8, 2024. The offshore RMB exchange rate against the US dollar, which reflects the expectations of international investors, has risen above the 7.04 yuan mark. According to Wind data, as of 16:30, the market exchange rate was reported at 7.0382 yuan, up 52 basis points from the previous closing price. The highest intraday price was reported at 7.0371 yuan, reaching a new high since October 2, 2024. The central parity rate of the Chinese yuan against the US dollar has also increased. According to data released by the China Foreign Exchange Trading Center authorized by the People's Bank of China, on December 16th, the central parity rate of the renminbi against the US dollar in the interbank foreign exchange market was 7.0602 yuan, an increase of 54 basis points from the previous trading day. In fact, the appreciation of the Chinese yuan against the US dollar began in late November. During this period, the onshore RMB exchange rate against the US dollar rose from around 7.11 yuan to around 7.04 yuan, with an appreciation of over 700 basis points; The offshore RMB exchange rate against the US dollar rose from around 7.11 yuan to around 7.03 yuan, an appreciation of nearly 800 basis points. Regarding the recent surge in the Chinese yuan exchange rate, Wang Qing, Chief Macro Analyst at Oriental Jincheng, stated that before and after the Federal Reserve cut interest rates, the US dollar index continued to decline, driving the general appreciation of non US currencies, including the Chinese yuan. According to Wind data, as of 16:30 on December 16th, the US dollar index was at 98.25, a daily decline of about 0.03%. The increasing demand for enterprise foreign exchange settlement has boosted the appreciation of the RMB exchange rate. Wang Qing stated that as the end of the year approaches, the increasing demand for foreign exchange settlement by enterprises has also driven the seasonal strengthening of the renminbi; Especially after the continuous strengthening of the RMB in recent times, the accumulated demand for foreign exchange settlement in the early stage may be accelerating. The Zhang Jingjing team of China Merchants Securities stated that the seasonal strengthening of the RMB exchange rate at the end of the year is mainly due to the seasonal characteristics of private sector settlement behavior before the Spring Festival. Historical data shows that before the Spring Festival, the surplus scale of bank settlement and sale of foreign exchange on behalf of customers is often the highest level of the year, and the support for RMB appreciation in the domestic foreign exchange market supply and demand relationship is about to reach the highest level of the year. In addition, a research report from the Financial Market Department of China CITIC Bank stated that the Chinese stock market has performed well, attracting cross-border capital inflows and providing impetus for the appreciation of the renminbi. Next year, there is a possibility of a moderate appreciation. Looking at the longer period of time, the RMB exchange rate against the US dollar has remained stable and has risen throughout the year. According to Wind data, as of 16:30 on December 16th, the onshore and offshore RMB exchange rates against the US dollar have risen by 3.51% and 4.07% respectively since the beginning of this year. In 2025, the overall operation of the RMB foreign exchange market will be stable, and the exchange rate against the US dollar will show a trend of 'weak first, then strong, and narrowing volatility'. ”The above report shows. Looking ahead, multiple experts have stated that the RMB exchange rate against the US dollar will remain relatively strong in the short term and is expected to maintain a moderate appreciation in 2026. It is expected that the Renminbi will continue to maintain a relatively strong operating state in the short term. Next, we need to focus on the trend of the US dollar, the strength of the Renminbi's central parity rate regulation, and the intensity and pace of domestic policies to stabilize growth. ”Wang Qing said. The chief economist of CITIC Securities clearly stated that the trend of weak operation of the US dollar index in 2026 may continue, and at the same time, the central bank's policy of stabilizing the exchange rate is expected to be relaxed to some extent, enhancing the resilience of the RMB exchange rate. It is expected that the RMB exchange rate will appreciate moderately. If domestic policies are coordinated and drive the gradual recovery of endogenous economic momentum, internal and external factors are expected to form a significant synergy, which will catalyze the breaking of the RMB exchange rate center to 7 yuan. Li Liuyang, Chief Analyst of Foreign Exchange Research at the Research Department of China International Capital Corporation (CICC), stated that next year, the RMB exchange rate will continue to balance multiple goals such as economic growth, stable international payments, and RMB internationalization, and the trend may be relatively stable. (New Society)