00HSI

<p>CICC analyzes the recent phenomenon of the strengthening of the RMB and the divergence from the stock market correction. The RMB has appreciated against the US dollar, but the Hong Kong stock market has seen significant declines. Historically, exchange rates and stock markets are usually positively correlated, but the recent divergence may be due to different driving factors. China's trade surplus has reached a record high, and there are strong expectations for RMB appreciation, which may bring new momentum for asset revaluation</p>

- The recent strengthening of the Renminbi against the US dollar contrasts with declining stock markets, particularly in Hong Kong, where the Hang Seng Index has dropped 15% since early October.  
- This divergence is attributed to differing driving factors; while the Renminbi's rise is spurred by historical trade surpluses and weakened dollar forecasts, the stock market reflects weakening domestic fundamentals and credit cycles.  
- Historically, such discrepancies are rare, and the relationship between exchange rates and the stock market may realign depending on future economic conditions and government policies.

CICC: Who is "wrong" between Hengke and the Renminbi?