The Effect of RMB Devaluation

Will the recent devaluation of RMB have positive influence on China’s yarn textile industry? Some considered that it would be definitely good news to exports of China’s textile industry. But from the current situation, textile companies stay sidelines towards the rate devaluation effect in the textile industry.

For the influences brought by RMB devaluation, the stimulation is quite constrained. Experts think that the devaluation of RMB during this period is a kind of way to protect exports industry, stimulate the increase of exports, and relief the loss of price advantages. It is supposed to be positive impact on the domestic exports market. However, some neighboring countries, especially those countries which have competitive relationship with China, also have a fall of exchange rate. It is indicated that in the past twelve months, the exchange rate in some south-western countries, like Malaysia and Indonesia, fell separately by 28% and 18%. It is estimated that the devaluation of RMB will not affect China’s yarn textile industry virtually in comparison with the rate fall of these countries.
The devaluation of RMB will actually enlarge the need of the consumption of textile industry to some extent. But it is only temporary. We believe that with the upgrading and innovation in enterprise products, the textile industry will be powered!