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At 3 a.m. on December 14, the United States ushered in the third rate hike since the beginning of this year. The Federal Reserve announced that it will raise interest rates by 25 basis points to 1.25% -1.5%.
Guided by the Fed's rate hike policy, Canada and the United Kingdom have taken the lead in raising interest rates following the Fed. Mexico, Brazil and Russia have already entered the rate hike cycle. Recently, South Korea also made its first interest rate hike in six years and officially entered the rate hike channel . Just after the Federal Reserve announced the rate hike, the People's Bank of China has just announced a 5 basis point rate hike in the money market! It can be said is expected. Prior to China's central bank raising interest rates, the Hong Kong SAR declared a 25-point interest rate hike and raised the benchmark interest rate to 1.75%.
Obviously the central bank is willing to raise interest rates, but also very worried about the market have much impact, so do not raise the "benchmark deposit and lending rates," and even the introduction of "targeted RRR" to hedge. In the medium and long term, China's interest rate will gradually rise. However, due to the great difficulty in economic restructuring, higher interest rates will be a long process and will take a two-step step back and forth. And the existence of foreign exchange control in China, large financial institutions are state-owned enterprises, which constitutes a more effective firewall. The so-called collapse, basically impossible.
Since the U.S. dollar is the main settlement currency for international businesses, the prices of international raw materials are also calculated in U.S. dollars and the financial assets are also denominated in U.S. dollars. Therefore, the impact of the Federal Reserve's rate hike on the international capital flows, foreign trade businesses and the stock market should not be underestimated. So the Fed's chain reaction brought about by this rate hike and the impact of the central bank's interest rate increase on China's textile industry are there?
First, the cost of importing high-grade, high-grade cotton, such as the U.S. cotton and Australian cotton, has risen. US stocks and the US dollar index rose sharply due to the Federal Reserve's rate hike. The corresponding devaluation of emerging currencies such as the Renminbi (Renminbi) has put pressure on them. Import costs are constantly rising, which is not conducive to the import of commodities including cotton and corn. Taking into account the end of the year, most of the orders for textile enterprises have been completed, China's new cotton has also been listed, unless the customer's special orders, textile enterprises in order to save costs, will give up some of the US cotton import quotas. Of course, relative to the United States cotton, Australian cotton, etc., the purchase of cotton India, Uzbekistan, cotton and so on by the soaring dollar index has little effect (all currencies depreciate against the dollar).
Secondly, the import of Indian yarn, Vietnam and other origin of foreign yarn and fabric have no obvious effect. From the survey, since 2015, China's weaving factories and traders purchase southeast Asia cotton yarns are usually direct orders to the yarn mill, basically bypassing foreign trading companies or exporters, and the main "futures" yarn (import Of the Vietnamese yarn, about 70% of them are returned to China by Chinese enterprises to invest and build factories in Vietnam.) Both buyers and sellers directly "negotiate" to some extent to avoid the risk of fluctuations in the exchange rate of the U.S. dollar. However, due to inconsistencies in the devaluation of the two currencies or adjustment of direction There may be inconsistencies. Therefore, for Chinese purchasing enterprises, it is more beneficial to import yarn and fabric in order to shorten the period for placing orders, deliver the products in advance or negotiate with the foreign mills for the exchange rate.
Third, the Fed's rate hike does not mean that the Chinese textile and apparel exports will have an "explosive" chance. Although the United States refers to the constant climb, the continuous devaluation of the renminbi trend is inevitable, is conducive to China's exports, textile and clothing exports rapid rebound, but need to be noted that the recent countries such as Europe, America and Japan have "tore up" WTO agreement, Therefore, the developed countries in Europe and the United States and other developed countries set import barriers to trade at different levels and frequently engage in "anti-dumping" measures against Chinese products to weaken the export competitiveness and channels of China's products. This will further increase the use of "alternative country" prices in anti-dumping cases. "Unscrupulous"; but also because of the timing of this rate hike, China textile and garment enterprises, foreign trade companies to be vigilant.
Finally, raising interest rates can make the currency appreciate, holding the dollar yield higher. The rate hike in the United States will have an absorbing effect on the funds of other countries. One after another, the U.S. interest rate holders will hold the U.S. dollar, resulting in the outflow of funds. Since the United States started raising interest rates in 2015, some countries have preceded the currency collapse. Therefore, the combination of tax cuts and interest rate increases in the United States will cut wool all over the world like two sharp knives. There must be some negative impact on the Chinese enterprises, but the impact will be manageable. There are two reasons for this. First, China has already lightened its impact by raising the interest rate by 5 basis points following the interest rate increase in the United States. Second, there is capital control in China and the flow of capital in the capital market is governed by the government.
Therefore, although the Federal Reserve's rate hike will have an impact on the textile industry in our country, relevant government regulatory departments will also have corresponding solutions to minimize our losses.