A Study On YY Company's Countermeasure On RMB Exchange Rate Devaluation Risk

As one of the most important factors affecting the import and export business,Exchange rate has always been the focus of risk control by company.With the accelerated process of RMB internationalization,on August 11,2015,the people's Bank of China decided to improve the price mechanism of the RMB against the U.S.dollar: before the interbank foreign exchange rate market opening,the market maker will take consideration of the yesterday's interbank foreign exchange rate as well as the supply and demand of foreign exchange and major international currency exchange rate,and then provide a middle price quote to the Chinese Foreign Exchange Trading Center.This reform enhances the marketization and the benchmark of the middle price of RMB against the U.S.dollar exchange rate,after that the RMB exchange rate floats greatly daily and becomes to devaluation in a long time.With the beginning of devaluation of the RMB exchange rate trend,the negative impact will undoubtedly increase for the import and export company.For the import and export companies,their most important issue is how to control the exchange rate risk.In this paper,under the background of RMB exchange rate devaluation,through the literature sorting and case study method,taking YY Company's business(Organizational structure,human resources,business products,business model,Operating performance)as the breakthrough point,analysis of the current RMB exchange rate depreciation under the import business status of YY company.And then from the phenomenon to the nature of the exchange rate fluctuations affect the YY import business development risk factors Transaction risk,financing risk,accounting risk,and focus on the analysis of the risk factors arising from the substantive reasons: Loose exchange rate management system,a single business model,exchange rate hedging tools missing.Finally,according to YY's own situation,the paper puts forward the countermeasures from the long-term to the short-term,including the establishment of the exchange rate risk management system,the adjustment of business structure and the application of foreign exchange hedging instruments.These suggestions will play an effective role in the prevention of YY Company's exchange rate risk.The author hopes to help the other domestic import companies to play an important role in the exploration of the exchange rate wind control by using the results of the research on the wind control measures of the YY company to devaluate the RMB exchange rate.