Outlook -Supply Chain
My first Bitcoin investment
February 8, 2021
Everybody wishes that the Coronavirus (COVID-19) pandemic is over in 2021. As more vaccines are available and more people are getting vaccinated, this goal is reachable soon and the word is expected to recover gradually.
The sea freight rate has skyrocketed at the end of 2020 because of several reasons 1) The outbreak of the COVID-19 pandemic, 2) Reduced supply and demand 3) Upcoming global economic recovery 4) Holiday seasons. The gradual introduction of vaccines gives hope for the return to the “old normality” in 2021. It would mean economies’ recovery, an increase in both demand and supply, associated with an increase in imports.
The first factor we consider is a comparison between the Covid-19 situation within China and that outside of China. We view this as a determinant of how well the Chinese economy will perform relative to other major economies. Following China’s rapid recovery from Covid-19, GDP growth is set at 7% in 2021, versus 1.7% in 2020. In the past, China has aimed for currency stability, together with a preference for preventing the yuan from becoming overly strong.China has a strong domestic economy and does not rely solely on exports but also on imports, and cross border investment flows can therefore be both inbound and outbound. In short, the exchange rate is probably no longer a central determinant of the profitability of China’s businesses. The positive outlook would lead to an appreciating yuan continually.
Logistic Costs
Along with minimizing costs, the sourcing team in Mi-Network has always played a role in mitigating risk. In 2020, we resolved many procurement and delivery issues due to logistics breakdown. We predict that it will take time to get the world economy recovered. The supply of some industries still remains tight so it led to high-demand for courier services. . Like the peak season surcharge imposed by all the major express couriers, FedEx, UPS and DHL, it is expected to last for a while until the passengers flights are getting normal. Many governments are considering the “Travel Bubble” scheme with the neighbouring countries to allow passengers to travel within the “bubble” without 14 days quarantine now.The sea freight rate has skyrocketed at the end of 2020 because of several reasons 1) The outbreak of the COVID-19 pandemic, 2) Reduced supply and demand 3) Upcoming global economic recovery 4) Holiday seasons. The gradual introduction of vaccines gives hope for the return to the “old normality” in 2021. It would mean economies’ recovery, an increase in both demand and supply, associated with an increase in imports.
Exchange Rate-CNY/USD
The exchange rate plays an important part in the supply cost. As a majority of products are made in China, the movement of CNY affects the product cost. CNY appreciated over 5.6% against the dollar in 2020. The average exchange rate in December 2010 was 6.476 compared with the average exchange rate in January 2010: 6.8318. An increasing trend of CNY seems to continue in 2021.The first factor we consider is a comparison between the Covid-19 situation within China and that outside of China. We view this as a determinant of how well the Chinese economy will perform relative to other major economies. Following China’s rapid recovery from Covid-19, GDP growth is set at 7% in 2021, versus 1.7% in 2020. In the past, China has aimed for currency stability, together with a preference for preventing the yuan from becoming overly strong.China has a strong domestic economy and does not rely solely on exports but also on imports, and cross border investment flows can therefore be both inbound and outbound. In short, the exchange rate is probably no longer a central determinant of the profitability of China’s businesses. The positive outlook would lead to an appreciating yuan continually.
