Commerzbank Challenges China's Exchange-Rate Management on Yuan Undervaluation
Volkmar Baur of Commerzbank questions recent analysis on China's exchange-rate management, arguing that deliberate weakening is behind the Chinese Yuan's undervaluation. He points to China's outsized export and trade-surplus gains since 2019 as evidence.
Between 2019 and 2025, China increased its real exports by 47%, while global trade grew by only 15% over the same period. This means that China gained market share somewhere in the world during this time.
The country's trade surplus rose from about $400 billion to $1,180 billion between 2019 and 2025. In 2025, China's trade surplus in manufactured goods reached 1.75% of global gross domestic product, a figure that even Germany and Japan combined could not match.
Baur notes that unlike other major currencies such as the D-Mark or the JPY, the Chinese Yuan's real exchange rate depreciated by about 10% on a trade-weighted basis between 2019 and 2025, and by as much as 22% against the euro.