On September 9, 2026, the central parity rate of the RMB against the USD reached 6.7769, up 35 basis points from the previous session, the highest since February 8, 2023. This marks a continued strengthening trend, meaning that dollar-denominated export orders are now worth less when converted into RMB. For textile foreign trade, this is not just a number change but a direct revaluation of profit margins.
Policy Signals Behind the Stronger RMB
The People's Bank of China announced zero reverse repo operations on the same day, citing the demand from primary dealers. With no repos maturing, the operation resulted in zero net injection or withdrawal. This seemingly neutral move reflects a cautious stance on liquidity management—neither easing nor tightening—aiming to keep funding conditions stable. For textile enterprises, zero reverse repo means short-term funding costs won't fluctuate sharply, but the exchange rate remains the real variable.
The upward adjustment of the central parity reflects market expectations of further RMB appreciation. Since February 2023, the cumulative appreciation has been substantial, driven by factors such as Sino-US interest rate differentials, trade dynamics, and policy orientations. For textile export orders settled in USD, every 1% appreciation may erode gross margins by 0.5 to 1 percentage point, depending on the company's hedging ratio and cost structure.
Industry Transmission: Exports Under Pressure, Imports Benefit
The impact of RMB appreciation on the textile industry chain is two-sided. On the export side, goods such as apparel, home textiles, and fabrics, priced in USD, convert to fewer RMB. This is particularly harsh on small and medium-sized OEM enterprises with thin profits. Some firms may be forced to raise prices, but overseas buyers are price-sensitive, limiting room for increases and raising the risk of order losses.
On the import side, the stronger RMB is favorable. The textile industry relies on imported cotton, wool, chemical fiber raw materials, and high-end dyes and auxiliaries. A stronger RMB means lower purchasing costs. For companies with a high proportion of imported raw materials, this can partially offset export losses. Additionally, overseas equipment purchases and brand licensing fees become relatively cheaper, providing a window for industrial upgrading.
From a regional perspective, textile clusters such as Keqiao, Shengze, and Nantong are most sensitive to these changes. According to public industry information, some companies have started adjusting their pricing strategies, incorporating exchange rate fluctuations into contract terms, or switching to RMB settlement to avoid risks. However, this requires customer cooperation and cannot be achieved overnight.
Practical Recommendations
For Textile Exporters - Increase the proportion of forward exchange hedging to lock in favorable settlement rates and avoid reversal risks. - Attempt to price in RMB or a basket of currencies in negotiations to diversify the impact of USD fluctuations. - Optimize supply chain structures by increasing the use of imported raw materials to take advantage of the appreciation window and reduce procurement costs.
For Buyers - Monitor exchange rate trends and central parity changes, and arrange order and payment schedules reasonably to avoid locking in high prices during appreciation channels. - Negotiate with suppliers to establish an exchange-rate-linked pricing mechanism for more transparent and fair price adjustments. - Evaluate the possibility of RMB settlement to reduce exchange losses and improve transaction efficiency.
RMB appreciation is a double-edged sword for the textile industry. In the short term, export profits face pressure, but in the long run, it forces companies to enhance added value and optimize product structures. Those who can establish flexible financial strategies in the currency game will gain the upper hand in the next cycle.