China’s recent efforts to internationalize its currency Renminbi (RMB) have backfired. Countries such as Russia, Brazil, etc. have received RMB from trading with China and then heavily sold RMB on the offshore RMB market, causing the RMB price to keep falling.
Twitter account “@AsiaFinance” recently tweeted about an arbitrage opportunity in trading RMB: First, sell a little over 70,000 yuan of RMB to buy US$10,000. Second, exchange the US$10,000 for 1.5 million Russian Ruble on the black market. Third, exchange the 1.5 million Ruble, at the official exchange rate, for 127,300 Yuan RMB. Then you have turned 70,000 yuan to over 120,000 yuan.
Source: Twitter “@AsiaFinance” account, July 7, 2023
— 亚洲金融 Asia Finance (@AsiaFinance) July 7, 2023