Is it more cost-effective to exchange RMB for USD? 2026 Exchange Rate Trend Forecast and Investment Decision Guide

In the context of the current global economic shifts and the fluctuating dollar trend, more and more investors are contemplating a core question: Is it worthwhile to exchange for USD now? The answer largely depends on your judgment of the future RMB exchange rate.

According to the latest market data, the RMB successfully broke through the 7.0 psychological barrier by the end of 2025. As of February 2026, it stabilized around 6.9, showing a clear appreciation trend. This turning point marks the end of a three-year depreciation cycle from 2022 to 2024, entering a new phase of medium- to long-term appreciation. For investors considering exchanging for USD, understanding the underlying driving logic is crucial.

RMB Appreciation Cycle Begins, USD Weakening Becomes Key

Over the past year, the RMB exchange rate experienced a significant shift. Throughout 2025, USD/RMB fluctuated within a broad range of 6.95 to 7.35, appreciating about 4%. This reversal was driven by short-term policy factors and reflected a mid-term change in the pattern.

Specifically, in the first half of 2025, the RMB faced considerable depreciation pressure. Due to global tariff uncertainties and a persistent strengthening of the US dollar index, offshore RMB once broke through 7.40, setting a new record since the 2015 “8.11” reform. Market expectations of further RMB weakening increased significantly.

However, in the second half, the landscape changed markedly. As China-US trade negotiations progressed steadily, relations eased, and the US dollar index weakened, the RMB gradually stabilized. Notably, in mid-December 2025, driven by Fed rate cuts and market sentiment recovery, the RMB surged past 7.05. By December 30, 2025, it officially broke the 7.0 mark, reaching around 6.9623. Into 2026, the RMB did not retreat but was strongly supported around 6.9, maintaining a relatively strong stance linked to the dollar index.

Will the RMB Continue to Appreciate in 2026? What Do International Banks Say?

The market generally believes the RMB exchange rate is at a cyclical turning point. The depreciation cycle starting in 2022 may have ended, and the RMB could enter a new phase of medium- to long-term appreciation.

Top international investment banks are quite optimistic. Deutsche Bank analysts suggest that the recent strength of RMB against USD may indicate the start of a long-term appreciation cycle, with a forecast of RMB/USD reaching around 6.7 in 2026. Goldman Sachs also remains bullish, expecting the RMB to target 6.85 in 2026 supported by policy.

Looking ahead to 2026, professional institutions identify three main factors supporting RMB strength:

1. Continued resilience in China’s export growth, with key industries maintaining stability despite trade frictions.
2. The re-establishment of foreign investment in RMB assets, as international investors recognize China’s asset appeal.
3. The structural weakness of the US dollar index, with Fed rate cut expectations putting pressure on the dollar.

Four Key Factors to Watch When Investing in RMB

The future trend of the RMB is influenced by multiple factors rather than a single one. For investors considering the timing of exchanging for USD, these four factors are most critical:

Factor 1: The Fed’s Monetary Policy Direction

The Fed’s stance directly impacts the dollar’s strength. In 2026, markets expect 2-3 rate cuts. As the labor market stabilizes, the Fed shifts focus to preventing a hard landing, adopting preemptive rate cuts. This reduces US bond yields, eases interest rate differentials, and encourages capital inflows into emerging markets, boosting the RMB.

In short, if the Fed continues to cut rates, the dollar faces depreciation pressure, and the RMB remains relatively strong. Conversely, if the Fed pauses or reverses rate cuts, the dollar rebounds, testing the RMB’s resilience.

Factor 2: The Substantive Development of China-US Economic and Trade Relations

Recent China-US trade talks in Kuala Lumpur reached some consensus—US tariffs on Chinese fentanyl-related goods were reduced from 20% to 10%, and some additional tariffs were suspended until November 2026. However, this balance remains fragile. Whether substantive improvement in China-US relations can continue into late 2026 is a key external uncertainty in USD/RMB outlook.

If relations further improve, risk appetite rises, and RMB benefits from capital inflows; if tensions escalate again, RMB will face depreciation pressures.

Factor 3: The Strength of China’s Economic Stabilization Policies

China’s monetary policy tends toward easing to support economic recovery. The People’s Bank may cut interest rates or reserve requirements, which typically puts downward pressure on the RMB. However, if easing policies, combined with stronger fiscal stimulus, stabilize and improve the economy, the RMB could be long-term supported. The effectiveness of 2026’s growth stabilization policies on domestic demand and the stock market will directly influence the RMB’s long-term bottom.

Factor 4: Progress of RMB Internationalization

Increased use of RMB in global trade settlements and expansion of currency swap agreements with other countries may support RMB stability over the long term. However, in the short term, the dollar’s status as the primary reserve currency remains dominant, making RMB internationalization a medium- to long-term support rather than an immediate driver.

Is It Worth Exchanging for USD Now? Decision Criteria and Recommendations

Returning to the core question: Is it worthwhile to exchange RMB for USD now? The answer isn’t simply “yes” or “no” but depends on your time horizon and risk appetite.

Short-term (3-6 months):

The RMB is expected to remain in a strong oscillation. With the end of 2025 seeing the RMB break above 7.0, it is currently deeply linked to the dollar index, with strong support around 6.9. Since early 2026, it has stabilized below 7.0, with a low likelihood of falling back below 7.1 in the short term. This means that if you exchange now, you face the risk of RMB further appreciating, which could be unfavorable for your exchange rate.

For those with immediate USD needs, a phased approach—gradually converting rather than all at once—is advisable to diversify exchange rate risk.

Medium-term (6 months to 2 years):

The market is seeking a new equilibrium between 6.90 and 7.00. Most international banks forecast RMB appreciation to around 6.70–6.85 in 2026. This implies that if you exchange now, you might face a reversal risk in the medium term—RMB appreciation could lead to losses when converting back to USD.

For medium-term asset allocation, carefully evaluate the necessity of exchanging now. Only if you have imminent USD expenses or believe USD assets will outperform RMB assets in the medium term should you consider converting.

Long-term (over 2 years):

The RMB appreciation cycle could last several years. Historically, policy-driven exchange rate cycles can last a decade. If a new appreciation cycle is confirmed, holding USD long-term might lead to asset depreciation. However, this doesn’t mean you should fully hold RMB—maintaining a balanced USD exposure aligned with your asset allocation and risk management is prudent to hedge geopolitical and global asset risks.

Four Major Considerations for RMB-Related Investment Decisions

Market variables remain complex; investors should monitor:

1. The downside potential of the dollar index—if the Fed’s rate cut expectations diminish, the dollar could weaken further, supporting RMB appreciation.
2. Official policy stance on exchange rates—whether authorities will intervene at key levels like 6.9 to prevent rapid appreciation, affecting the pace of RMB strengthening.
3. The actual impact of China’s stabilization policies—if policies effectively stabilize and boost the economy, RMB will be supported; if not, appreciation may be limited.
4. Geopolitical and trade developments—any new tensions or trade frictions could reverse RMB gains.

Five-Year Historical Perspective: Understanding RMB Cycles

To accurately forecast RMB, reviewing past cycles is instructive. Over the last five years:

• 2020: RMB fluctuated between 6.9 and 7.0 early in the year. COVID-19 and trade tensions caused a dip to 7.18 in May. Rapid recovery followed, ending the year around 6.50, appreciating about 6%.
• 2021: RMB remained relatively strong, with steady exports and economic recovery. USD/RMB hovered between 6.35 and 6.58, averaging around 6.45.
• 2022: A turning point—aggressive Fed rate hikes pushed USD/RMB above 7.25, depreciating about 8%. China’s strict COVID policies and property crisis weighed on the economy.
• 2023: Continued depreciation, USD/RMB between 6.83 and 7.35, averaging about 7.0. Economic recovery was sluggish, and high US rates persisted.
• 2024: Signs of reversal—dollar weakening and fiscal stimulus boosting confidence. USD/RMB rose from 7.1 to around 7.3 mid-year, with increased volatility.
• 2025: The RMB ended its depreciation cycle, appreciating about 4%, signaling a shift from depreciation to appreciation expectations.

These cycles show that exchange rates are driven by multiple interacting factors—fundamentals, policies, global risk sentiment—and current appreciation reflects improved economic fundamentals, supportive policies, and rising risk appetite.

Special Characteristics of Offshore RMB (CNH)

It’s important to note that offshore RMB (CNH) behaves differently from onshore RMB (CNY). CNH, traded in international markets like Hong Kong and Singapore, is more freely traded and less controlled, reflecting global market sentiment more directly, often with larger fluctuations.

In contrast, CNY is subject to capital controls, with the People’s Bank of China guiding the exchange rate via daily fixing and interventions, resulting in more stability. In 2025, despite multiple fluctuations, CNH showed an overall upward trend, with a dip below 7.36 early on due to US tariffs, prompting PBOC measures. Recently, with easing US-China tensions and economic stabilization, CNH strengthened significantly, reaching 6.95 at the end of January, a 14-month high.

Investors should understand that CNH movements do not necessarily mirror CNY’s official rate. Timing exchanges at CNH peaks may not be optimal; waiting for CNY to gradually appreciate under official guidance might be wiser.

Summary: Framework for RMB to USD Investment Decisions

As China enters a sustained easing cycle, USD/RMB has shown a clear upward trend. Historically, such policy-driven cycles can last a decade, with short-term fluctuations influenced by USD trends and global events.

Key question: Is it worthwhile to exchange RMB for USD now? The answer depends on your investment horizon.

• If you have immediate USD needs, consider phased conversions to mitigate risk, avoiding full upfront exchange to prevent short-term RMB appreciation losses.
• If your goal is diversified asset allocation, maintaining a moderate USD exposure amid an RMB appreciation cycle is reasonable. Only increase USD holdings if you believe USD assets will outperform RMB assets in the medium term.
• If you are just following the market or lack a clear view, it’s prudent to wait for clearer signals before acting.

Foreign exchange markets are primarily macro-driven, with transparent data and large trading volumes, making them more accessible than other investments. However, this advantage only materializes if investors understand market logic and make informed decisions.

By closely monitoring the key factors influencing RMB—Fed policies, China-US relations, China’s economic policies, and RMB internationalization—you can significantly improve your chances of profitable currency exchange decisions. The key is to avoid blind following and act based on genuine needs and a clear judgment framework.