In this tumultuous financial world, the US dollar and the Chinese yuan seem to be dancing a waltz, sometimes clinging closely together, and at other times pushing each other away. Recently, the exchange rate of the yuan against the US dollar has plummeted, and with a careless slip, it has "bang" broken through the 7.3 level. In this rollercoaster game of currencies, some countries have gripped the safety bars, while others have been thrown out of their seatbelts. Next, let's take a light-hearted look at this "carnival" in the global currency market.

Opening Remarks

When it comes to exchange rates, you might think, what does this have to do with me? Oh, dear friend, it has a lot to do with you! Consider this: those "overseas purchases" you make on Taobao might become more expensive or cheaper due to exchange rate fluctuations. Indeed, recently the US dollar has been wildly fluctuating as if someone stepped on its tail.

The Rollercoaster of Exchange Rates

Firstly, we must mention the tug-of-war between the US dollar and the Chinese yuan. In the past few months, the yuan has been on a rollercoaster, sometimes plunging downward, and at other times slowly climbing up. The result is that recently the exchange rate of the yuan against the US dollar has actually broken through the 7.3 mark, causing many currency holders to feel alarmed.

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Japan and South Korea's Small Boats Capsize Easily

It's not just China and the United States that are affected in this currency game; Japan and South Korea have also suffered significantly. The fluctuation of the US dollar has directly led to a substantial devaluation of the yen and the won. Japan and South Korea, two close friends of the United States, have faced considerable setbacks this year. To prevent the economy from collapsing due to the US dollar's volatility, the Japanese government has initiated a series of market intervention actions. Imagine, the government stepping in to intervene in the economy; this is not a common occurrence in Japan.The Domino Effect of the US Dollar's Fluctuation

The fluctuation of the US dollar has not only impacted the foreign exchange market but also has a direct effect on the daily lives of ordinary people. In Japan, due to the persistently low exchange rate, even the price of fruit has begun to soar. Some Chinese people in Japan have reported that the price of fruit has skyrocketed from 400 yen to 600 yen, an astonishing increase of one-third.

The United States' Attitude and Actions

In the midst of all this, the United States has maintained a rather "calm" demeanor. Despite the Japanese government's three interventions in the market, US Treasury Secretary Yellen has chosen to remain silent. At the same time, the US has demonstrated a certain degree of "hegemony" in its foreign economic policy. They have raised tariffs to use China's money to fill their own gaps, while also hoping for a "rational" response from China.

China's Precautionary Measures

In the meantime, China has not been sitting idly by. Reports indicate that China has already begun to reduce its holdings of US Treasury bonds and has been purchasing a large amount of gold as an economic defense strategy. Such actions not only protect itself from the impact of the dollar's volatility but also demonstrate China's economic confidence and foresight on the international stage.