Measure On Dislocation Of RMB Real Exchange Rate And Analysis Of Economic Effect

Exchange rate is very important to manage national economy.With the conomic globalization and financial libernalization, exchang rate has acted more and more obvious function to nation's economic development as the main means of controlling and economic lever in nation's macro economy the.The change of exchange rate will influence largely on economic of China.Recently the market has a strong appreciation of the RMB exchange rate expectations. To determine the RMB exchange rate is reasonable, we must first measured the level of the RMB equilibrium exchange rate. Equilibrium Exchange Rate which is one of the core issues in Exchange Rate Theory, is main objective basis to determine whether the level of dislocation the real exchange rate and the need to adjust exchange rate policy.Theoretical studies have shown that the exchange rate dislocation, whether it is overvalued or undervalued, will cause the economy to pay welfare and efficiency costs. On this basis, according to market development situation and economic and financial situation, adjust the exchange rate floating range of RMB exchange rate at a reasonable and balanced level to promote basic balance in China's international payments and maintain China's macroeconomic and financial market stability .In this paper, through behavior equilibrium exchange rate (BEER) model to estimate the equilibrium exchange rate of RMB, on the basis of estimation to measure dislocation on the real exchange rate of RMB, as well as dislocation of the real exchange rate effects on economy. On empirical analysis, we found the dislocation of exchange rate exist a certain degree of negative influence on China's import, export, use of foreign capital and domestic economic growth. In order to reduce the negative effects to China's economy, the authors propose to build the target zone of RMB exchange rate. Through the analysis of disadvantage in the current Chinese exchange rate system and the advantages in implementation of exchange rate target zone and the current economic environment in our country, it is demonstrated that is a wise choice of the implementation of exchange rate target zone at this stage, is feasible. Set Equilibrium Exchange Rate to central exchange rate of RMB exchange rate target zone. With the changes in economic fundamentals, interest rates further market-oriented and completely open capital-account, floating band may be considered appropriate zoom .15 % can be used as limits of interval width in the RMB exchange rate target zone. Based on international experience, the emergence of 15% is seen as currency instability or possible harbinger of a currency crisis.