The short answer: cheap exports. However, that comes at a cost of making it expensive for Chinese travelers on heading overseas especially with EU, UK or US since they will need to pay more to exchange Euro / Pound or US Dollars when converting directly from RMB, since the Yuan is not strong against those major currencies.
Despite China having the second largest economy, their own currency is still weak against GBP, EUR & USD. Even though China is cashless for the most part, they still print bank notes (which are shit value) when you convert them as it's basically "pocket change" (so Western travelers have higher purchasing power than the Chinese):
By contrast when you exchange GBP, EUR & USD for Yuan (RMB): you still receive more than in their currency than a Chinese traveler would when they exchange RMB directly for GBP, EUR & USD when they're in a Western nation:
It would mean for a Chinese traveler, they'll be spending A LOT more money in the West (expensive for them due to lower purchasing power) than the reverse to an American, Brit or European when it comes of as "China is so cheap" flex just because they possess currencies that are worth more at face value.
The CNY is pegged to a basket of currencies.
Can you tell me more about the pegging? I tried to google it, and well now my wife wants to have a talk after work. That's never a good sign.