The following is a comparative analysis of the real purchasing power of the Renminbi and the US Dollar (excluding housing assets) against the market exchange rate based on publicly available data:

By deepseek:

Written in advance: The results are as expected. The question is why Chinese concept stocks are so sluggish. Why is the economy so sluggish? Scratching my head...

1. Core Concept Distinction

1. Market Exchange Rate: Determined by supply and demand in the foreign exchange market (average for 2023 is approximately 1 USD ≈ 7.2 RMB).
2. Purchasing Power Parity (PPP): Reflects the actual purchasing power of a currency against a basket of goods/services (2023 IMF data: 1 USD ≈ 3.99 RMB).
3. Adjustment Excluding Housing: Housing asset prices are significantly influenced by non-market factors such as policies and land supply, and need to be excluded to focus on daily consumption.

2. Data Comparison (Excluding Housing)

1. Purchasing Power of Daily Consumer Goods

Conclusion:

• Non-tradable goods (such as services, local food): The purchasing power of RMB is significantly stronger than the exchange rate (some are 30%-70% cheaper).
• Tradable goods (such as electronics): Prices are closer to the global market, and the exchange rate difference narrows.

2. Purchasing Power of Services (2023 Data)

Conclusion:

• Labor-intensive services: The purchasing power of RMB is 1.2-3.75 times that of USD, far exceeding the exchange rate difference.

3. Reasons for Differences in Purchasing Power and Exchange Rates

Price Differences of Non-Tradable Goods:

• The cost of local services in China (such as dining and haircuts) is low due to lower labor prices.
• In the U.S., labor costs in the service sector account for 80% of GDP, driving up prices.

Productivity and Trade Structure:

• China's manufacturing efficiency is high, and the costs of tradable goods (such as electronics) are close to global levels.
• The U.S. dollar, as a reserve currency, is influenced by capital flows, which do not fully reflect purchasing power.

Policy and Market Distortions:

• China controls prices of basic commodities like energy and food, suppressing inflation.
• In the U.S., the marketization of prices for services such as healthcare and education is high, increasing the cost of living.

4. Quantitative Comparison (Adjusted IMF Data)

• 2023 GDP (PPP, excluding housing):
• China: Approximately $28 trillion (originally $33 trillion × 85%).
• U.S.: Approximately $23 trillion (originally $26 trillion × 88%).
• Implied PPP Exchange Rate: $28 trillion ÷ $23 trillion ≈ $1 ≈ 4.2 RMB, still significantly higher than the market exchange rate (7.2).

5. Conclusion

1. In Daily Consumption: The actual purchasing power of the RMB is about 1.5-2 times the exchange rate (excluding housing).
2. Main Reasons for Exchange Rate Deviation: Factors such as capital controls, dollar hegemony, and trade surpluses lower the RMB exchange rate.
3. Policy Implications:
   • If the capital account is fully opened, the RMB may converge towards the PPP exchange rate (appreciation potential).
   • However, it is necessary to balance export competitiveness with domestic inflation pressures.

Note: The above data is a simplified model; actual calculations require more complex adjustments of commodity basket weights (such as the World Bank ICP project methodology)