The Management Of RMB Exchange Rate Risk And The Selection Of Financial Instruments

At present, the reform of the Renminbi exchange rate regime that our country practice brought a series of new problems, especially enlarged the exchange rate risks that the domestic enterprises and financial institutions face. The more fluctuant Renminbi exchange rate will challenge the risk management of the domestic enterprises and financial institutions which have been used to the environment that the Renminbi exchange rate was tightly pegged to US dollar. How to choose financial derivatives or projects to avoid risks and how to exalt the rate risk management ability are important missions of exchange rate risk management in our country at the present stage.On the foundations of parsing the reform of the Renminbi exchange rate regime, this dissertation summarizes the related research results in the aspect of financial engineering, the basic theories of exchange risk and the exchange risk management theories. On the analysis basis of the overall situation of the exchange rate risk management in our country, it refers the shortages of it.This research identifies and analyses different kinds of exchange risks that the different enterprises and commercial banks face, and then elaborates the impact on them because of the reform and the Renminbi appreciation. This research points out that the exchange rate fluctuation and holding the foreign currency property or liabilities are the direct decisive reasons of various exchange risks. The impact on domestic enterprises and commercial banks because of the reform and the Renminbi appreciation is both positive and negative.By contrasting kinds of financial derivatives that have been widely used in other countries, combining with the exchange rate risk management experiences of foreign countries and the development of the financial derivatives in our country, on the basis of case analysis, this dissertation draws some conclusions that combining existing financial derivatives with the trade financing methods is a solution of avoiding risks in present time and the development of financial market in our country including developing foreign exchange derivatives is the best way to fully improve the level of exchange rate risk management in our countries in long way.