The Impact of Fed Rate Cut Expectations on Yen and RMB

Xiaohuang: DOORM, with the expectation of the Federal Reserve cutting interest rates, the yen and RMB have seen a slight increase. What is the impact on future exchange rate trends?

DOORM: Xiaohuang, with the expectation of the Federal Reserve cutting interest rates, the yen and RMB have seen a slight increase mainly because the market anticipates a weaker dollar. However, in the medium to long term, the yen is expected to continue depreciating relative to the dollar and RMB. Japan’s economic fundamentals and monetary policy determine the yen’s long-term depreciation trend, while the RMB may benefit from China’s relatively stable economy and policy support.