RMB against US dollar will depreciate to 7 at end year of 2016

Trump was elected successfully, the GOVleaded by him will unavoidably impact the RMB exchange rate this year. We thinkRMB against US dollar will depreciate to 7 at end year of 2016. Looking aheadnext year, although the Federal Reserve is expected to increase interest rates,US economy can withstand the high interest rates and a strong dollar, it needtested for the future.

In addition, taking into account of the eightyears after the crisis, structural reform in the United States slowly grow,such as the proportion of manufacturing GDP is declining, widened incomedistribution gap, the current US economic turn to the better in some extents,and monetary policy dependence.

So we think RMB against the US dollar will depreciateup to 7.3 at the end of next year.