The Empirical Research Of The RMB Equilibrium Real Exchange Rate In China

Equilibrium real exchange rate is the real exchange rate fulfilling the macro internal-and-external equilibrium. It's the main impersonality thereunder judged whether the exchange rate is misaligned and the policies of exchange rate need to be adjusted. Equilibrium exchange rate is one of the core issues in theoretics about exchange rate. In fact, the real exchange rate often departures the equilibrium exchange rate ,which brings misalignment. The long-term misalignment will bring disadvantage impacts to the real economy. So it's important for the government and the currency authorities to confirm the reasonable level of equilibrium real exchange rate.In this paper, we establish the model for the equilibrium real exchange rate of RMB based on some advanced equilibrium real exchange rate theory, estimate and analyse the equilibrium level of RMB real exchange rate and then analyse the misalignment of RMB exchange rate and the correlativity between the misalignment and the foreign trades in our country. Finally, we put forward the suggestions for adjusting RMB exchange rate.In the first chapter, we summarize investigation theories and methods on the equilibrium real exchange rate of RMB in our country and put forward the aim and the methods used in this paper. The foreign investigations about the RMB equilibrium real exchange rate are few. By analyzing domestic investigations, we consider the equilibrium real exchange rate theory for developing countries and the behavior equilibrium exchange rate fit Chinese economy. They take into account the endogenetic of equilibrium exchange rate and consider a series of fundamental economic factors decide the equilibrium real exchange rate in the metaphase and long-term.In the second chapter, we definitude the concept of equilibrium real exchange rate and analyse its meanings combining with macro economy equilibrium. The equilibrium real exchange rate is the real exchange rate fulfilling the macro internal-and-external equilibrium in the metaphase and long-term. The internal equilibrium means the potential output or plenary employment and continuable lower inflation rate come true. The external equilibrium means the current account and the capital account carry out equilibriums. The relation between economy equilibrium and equilibrium real exchange rate is that the equilibrium exchange rate is the level of real exchange rate carrying out the current account and the capital account equilibriums in the case of the potential output.