Study On Model And Empirical Analysis Of Equilibrium Exchange Rate Of RMB

The Third Plenary Session of the 16th Party Central Committee of the party has proposed the goal of the exchange rate system reform of RMB are to improve the exchange rate forming mechanism of RMB clearly, keep the basic stability at the reasonable, balanced level of exchange rate of RMB. And on the premise of taking precautions against the risk effectively, choose and relax the restriction of stepping the border capital transaction step by step, to realize the exchange of capital item of RMB. According to this required goal, judging whether the exchange rate of RMB is at the reasonable, balanced level, you must confirm the equilibrium rate of exchange of RMB first. Meanwhile, to a great extent, whether the confirmation of the equilibrium rate of exchange is right or on, will determine the success of the system reform of exchange rate in our country.Basing on the method of combining quantitative analysis with qualitative analysis, absorbing and referring to the model of domestic and international equilibrium exchange rate, and on the premise of analyzing the facts of influencing the exchange rate comprehensively, we get the model of equilibrium real exchange rate (ERER) by applying the co-integrating technique of association in econometrics and referring to the model of equilibrium exchange rate (ERER) in developing countries. The empirical analysis combined with H-P filtering method in econometrics gets the level of long-term equilibrium exchange rate of RMB,and then analysis the displacement in various stages of displacement. Considering the actual conditions in our country, the foreign exchange reserve, which is regarded as an external variable, is introduced into the model of equilibrium rate of exchange. Then we construct appropriate the real exchange rate model (ARER) according with the state of development in developing countries even more. At last, we analyze the exchange rate mechanism's reform of RMB in our country , and put forward relevant suggestions.Proposing an appropriate real exchange rate model according with the actual economic situation in our country is the first innovation in this paper. This paper analyzes the reform process of the RMB exchange rate system systematically about the reform of RMB exchange rate system in July,2005, analyses the defect in the RMB exchange rate operating mechanism in our country, and puts forward some new meaningful suggestions of reform. This is the second innovation in this paper.