Study On The Reason Of RMB Appreciation External And Depreciation Internal And Its Effect On Macro-economics In China

A country's currency internal value is the domestic purchasing power, and its size is determined by the unit of currency can buy the goods and services decisions. External value of the currency is the country's foreign currency exchange capacity, through to the performance of the exchange rate. In accordance with the classic "Law of One Price," the currency of a country's internal and external value should be consistent. However, since 2002, RMB continued revaluation, at the same time, RMB's purchasing power in China's domestic value tends to decline. Deviations from internal and external value of the RMB are caused widespread concern in theoretical circles around the issue of RMB exchange rate, the academic study of a series.In this paper, we conclude the domestic and foreign scholars, theory. use of a combination of theory and empirical, qualitative and quantitative research methods, on China's RMB exchange rate and economic growth of the transmission mechanism, deviations from the value of the RMB and outside causes of the devaluation of the RMB's appreciation of the domestic macro-economic impact of an in-depth analysis and research, and on this basis put forward suggestions to solve internal and external value of the RMB non-conforming measures is recommended. By January 2002 to June 2008 monthly data related to the empirical analysis of the important conclusions are as follows:①the RMB's appreciation and depreciation of the impact of internal factors analysis showed that high economic growth rate, increasing foreign exchange reserves , the increase in money supply and inflation rate led to a revaluation of the RMB's main economic reasons; China's commercial Bank loan-to-deposit ratio continued to decline in 2003-2007 and since 2001, relatively rapid growth of China's foreign exchange reserves led to the rapid expansion of base money growth to form the "excess liquidity" is a major reason devaluation of the RMB's devaluation; during 2002-2008 the CPI, PPI, A-Share Index, in the Housing Index growth that .description of RMB's domestic purchasing power reduced..②the RMB's appreciation external and depreciation internal of the causes analysis shows that the empirical Exchange rate and economic growth and foreign exchange reserves have negative relationship, with the money supply and price level changes have positive relationship, the RMB exchange rate and consumer price indices and economic growth from the initial negative correlation, after a period of time is transformed into relevant correlation; RMB exchange rate and economic growth, money supply, consumer price index in the long-run have equilibrium relationship; Through the VAR model analysis shows that the RMB exchange rate and Consumer Price Index, as well as the RMB exchange rate and economic growth are the first between the role of the relationship between the reverse, after a lag effect into the same direction. Show that the RMB exchange rate on the consumer price index and the impact of economic growth for some time lag effect.③the RMB's appreciation external and depreciation internal to macro-economic impact on the empirical analysis shows that the value of long-term lack of co-ordination within and outside the RMB on economic growth, money supply, foreign direct investment has a certain impact on short-term economic growth, money supply and foreign the impact of weak investment. The short term, the economic growth rate for long-term deviation from the balanced to reflect insensitivity, it is difficult to adjust back to equilibrium; in the short term, the growth rate of pre-investment, net export growth and price growth for the current period of economic growth have a significant impact; preliminary economic growth rate, inflation rates and exchange rates on month growth rate of money supply growth rate significantly; foreign direct investment is mainly affected by three before the period of economic growth and the impact of exchange rate.④solve internal and external value of RMB non-conforming measures phenomena are: deepening of the RMB exchange rate formation mechanism of the market; proper control of the RMB exchange rate fluctuations in the frequency range; improve the financial ability to resist risks and cultivate a sound foreign exchange market; upgrade the industrial structure, enhance exports product mix; to play a role in the regulation of capital markets.