U.S. dollar plus favorable textile and apparel exports?
Fed announced the raising of the federal funds rate target range of 25 basis points to 0.50-0.75%, raising interest rates fully expected in financial markets. But the Fed chairman Yellen (Janet Yellen) said that the interest rate hike is the Fed interest rate adjustment on the road is very small, the market interpreted as this: the Fed suggests that 2017 will be more rapid increases in interest rates, or will raise interest rates three times 2017.
Although the United States that continue to climb, the continued depreciation of the RMB trend is inevitable (experts recommend Trump before taking office in January 20th, the RMB devaluation in place), is conducive to China's export of textile and apparel exports rebound quickly, but it is important to note that the recent Europe and Japan and other countries have "tear up" WTO protocol, refused to recognize the "market economy" status, still use the "surrogate country" in antidumping practice of price.
The increase in 2017 is expected to boost the gain increases after the dollar surged to a 14 year high since the moment, while emerging market currencies fell sharply down the lows, as the dollar is the main currency of international business, raw material prices in dollars, financial assets also denominated in dollars, then the impact of the Fed rate hike for me what are the country's textile industry?
First of all, U.S. imports of cotton, Australian cotton high grade high grade cotton (15825, 20, 0.13%) rising costs. Stocks, the dollar index by the Federal Reserve to raise interest rates (and suggests that 2017 may raise interest rates three times, the abnormal attitude of "hawks") to promote a disc to rise, and other emerging countries including RMB devaluation pressure prominent, import costs continue to uplift, is not conducive to include cotton, corn (1543, 12, 0.78%) and other commodity imports.
Considering Trump's election changed the monetary policy of the political environment, the deficit increase in the Fed rate hike sharply, imports of textile factory, so enterprises have 1% tariff cotton import quota is likely to increase in recent months imports of foreign cotton contract, lock as soon as the cost of imported raw materials. Of course, relative to the United States cotton, Australia cotton, procurement India cotton, Uzbekistan cotton and so on the impact of a sharp rise in the dollar index is not large (national currency against the dollar are devalued).
Secondly, India, Vietnam and other places outside the imported yarn and fabric effect is not obvious. From the survey, since 2015 China's purchasing cotton weaving factory, Southeast Asia is generally orders directly to the mill, basically bypassing the foreign trade company or the exporter, but mainly to sign "futures" (about 70% more than imports of yarn yarn in Vietnam is Chinese enterprises to invest and build factories in Vietnam back to China), both direct "negotiations", to a certain extent, to avoid the risk of fluctuations in the U.S. dollar, but because the currency depreciation is not consistent or adjust the direction may not be the same, so in 2017 of Chinese procurement enterprises, as far as possible to shorten the period of advance shipment or delivery orders with foreign mills negotiation to lock the exchange rate is more conducive to the yarn, fabric imports.
Again, the Fed rate hike does not mean that China's textile and garment exports outbreak opportunities come. In 2017, Europe and other developed countries set up trade barriers to imports, layers of frequent "anti-dumping" measures to weaken the export competitiveness of products China Chinese products and channels of practice will be more reckless; and since 2017, the intensity of interest rate hike point in time there is great uncertainty, Chinese textile clothing enterprises, foreign trade companies should be prepared to meet the challenge.