Obstacles And Control Research In The Process Of RMB Internationalization

In recent years,the world economic situation appeared some structural changes,the traditional mode of the international monetary system which rely on US dollar can not adapt to the demand of the international community gradually,at the same time,with the enhancement of economic strength and economic integration into the world of the Chinese economy,Renminbi give the international community a new choice,along with the continuously promote the internationalisation of the Renminbi,the effect to regional economy and the world economy is gradually enhanced.Along with the advancement of the internationalisation of the Renminbi is "One belt one road"construction's financing demand increased,the RMB capital account convertibility degree deepening,the development of the CNH market,domestic or foreign currency relationship market is more complex,the scale of cross-border capital flows are rising gradually and present a greater volatility,the internationalisation of the Renminbi is facing new opportunities and challenges.Currently,RMB internationalization has become a hot topic.There are many researches on the benefits of RMB internationalization and relevant promotion measures of RMB internationalization.At present,it is necessary to do more work in studying the obstacle mechanism and the management and control of RMB internationalization,to reduce the possibility of backwards in the process of RMB internationalization.Foreign countries have a lot of experience in promoting currency internationalization and controlling currency internationalization risks.For example,the United States,with its strong economic strength,has avoided or transferred relevant risks several times.The eurozone and Japan made some mistakes in risk prevention and control,which led to some setbacks in the internationalization of their currencies.Australia's experience shows that it is helpful for the economy to manage currency internationalization properly.Therefore,the main research work of this paper includes:1.Starting from the asymmetry of trade settlement,the risk source of RMB internationalization is essentially analyzed.Secondly,VEC model is used to study the linkage between the spread of offshore RMB exchange rate,the money stock and the expectation of RMB exchange rate.3.In order to explain the relationship between RMB internationalization,exchange rate and foreign exchange reserve,a general equilibrium model with built-in RMB internationalization,foreign exchange difference,foreign exchange market pressure and limited intervention of monetary authorities was established,and further verified by the three factor TVP-SV-VAR model.This paper found that;First of all,The currency internationalization is not homogeneous for every country.Whether one country is powerful or weak in the international trade determines the type of the country's currency internationalization.Yen internationalization and RMB internationalization are representatives of the two types.To be more specific,the varying degrees of foreign currency being substituted by local currency in the trade settlement of import and export could give full expression to the asymmetry.And then,the asymmetry have different effects on the country's exchange rate and foreign exchange reserves.China can' t blindly learn the experience of Yen internationalization.Secondly,the offshore market plays a key role in the internationalization of RMB.The capital stock factor is the main determinant of the spread of the offshore RMB exchange rate.The main reason for the development of CNH market in recent years is the continuous appreciation expectation,and the change of the spread of the offshore RMB exchange rate has an important impact on the appreciation expectation.Finally,We found RMB internationalization is closely related to exchange market pressure and offshore-onshore exchange rate gap.The rapid development of RMB internationalization is strong correlation with the long-term pressure of RMB appreciation,the accumulative pressure of foreign exchange reserves and the expected appreciation pressure which is represented by offshore market prices.At the same time,RMB internationalization will bring additional fluctuations to Chinese exchange market pressure,the empirical results also illustrate that the RMB exchange rate formation mechanism reform is very meaningful,since the"811" exchange rate reform,offshore market's influence to the RMB internationalization and exchange market pressure has been reduced.The possible innovations of this paper and its contribution to the existing literature are as follows:firstly,this paper comprehensively use the general equilibrium modeling method to put such factors as currency internationalization,offshore market factors,exchange rate,foreign exchange reserves and monetary authority intervention into an equilibrium model.Second,China and Japan are compared in a general equilibrium model.Finally,the use of the method of static econometric model and dynamic econometric model,such as vector error correction model and time-varying parameter vector autoregressive model.Based on international comparison and domestic empirical research,this paper puts forward policy Suggestions on risk management:first,the general principle of risk management is to promote financial reforms prudently and orderly.Second,strengthen the management of the offshore market and steadily advance the reform of the exchange rate formation mechanism.Third,we will strengthen management of cross-border capital flows.Fourth,we will improve the toolkit of macro-prudential management.