The RMB hits a new high again! Goldman Sachs predicts it will rise to 6.85 by 2026. What is the future of USD to RMB exchange rate?

Recently, the performance of the Renminbi has been quite interesting. As of November 26, the USD onshore RMB (USD/CNY) has fallen to 7.0824, and the USD offshore RMB (USD/CNH) has dropped even further to 7.0779, reaching a new low in over a year. Meanwhile, the CFETS RMB Exchange Rate Index had already risen to 98.22 on November 21, the highest level since April this year.

Why is the RMB so strong?

This is no coincidence. Two forces are driving this trend: on one side, the Federal Reserve has begun to cut interest rates, which has opened up space for the RMB to appreciate; on the other side, domestic policy guidance is playing a role — the People’s Bank of China (PBOC) has steadily raised the daily midpoint, and state-owned banks are frequently buying US dollars to stabilize the exchange rate.

This seemingly “moderate” operation actually sends a powerful signal. Kelvin Lam, senior economist at Pantheon Macroeconomics, pointed out that from a strategic perspective, China is demonstrating the stability of the RMB to build international credibility. This approach is not new — during the Asian financial crisis in 1998, the RMB established its regional anchor currency status by refusing to devalue.

A big move on the international stage

The comparison is clear: during the 2018 trade war, the RMB depreciated by about 5%; by 2025, it has appreciated nearly 3%. Behind this shift is China redefining the international role of the RMB.

Kiyong Seong, Chief Asia Macro Strategist at Société Générale, believes that showing the RMB’s resilience in such a turbulent market environment is essentially paving the way for RMB internationalization. Data from the Bank for International Settlements also confirms this — since 2022, the daily trading volume of USD against RMB has increased by nearly 60%, reaching 781 billion USD, accounting for over 8% of the total global daily foreign exchange trading volume.

Goldman Sachs forecast: hitting 7.0 by year-end, rushing to 6.85 in 2026

Goldman Sachs’ analysis team is quite optimistic about this trend. They believe that, based on authorities’ recognition of the RMB’s strength, the exchange rate could reach the psychologically important level of 1 USD to 7 RMB by the end of the year, and then continue to rise to 6.85 within the next year.

What is the deeper logic? Goldman Sachs points out that RMB internationalization has become a key policy for the Chinese government, and this process is expected to accelerate significantly in the coming years. This is not just about exchange rate numbers, but about the gradual elevation of the RMB’s status in the global financial system.

For market participants, this trend is highly significant — RMB appreciation is no longer just random fluctuation, but a manifestation of a planned, step-by-step internationalization strategy.