| Starting from July 21,2005, China reformed the exchange rate regime by moving into a managed floating exchange rate regime based on market supply and demand with reference to a basket of currencies. RMB will no longer be pegged to the US dollar and the RMB exchange rate regime will be improved with greater flexibility. China's exchange rate system reform made a significant step. The reform of its exchange rate mechanism has aroused wide concern in around China and abroad, the discussion is focus on the negative impact on the Chinese economy since RMB appreciation.This paper focuses on the theme of RMB appreciation on export trade of Jiangsu mechanical and electrical industry, select the data from January 2002 - to June 2009 Jiangsu Province to study the mechanical and electrical industry samples using Johansen co-integration test, error correction model and impulse response analysis, testing of the real exchange rate between mechanical and electrical exports, changes in long-and short-term dynamics. On this basis, analyzes the current situation in how to avoid the exchange rate risks and existing problems of Jiangsu mechanical and electrical industry, and then find a solution to address the exchange rate risks of reform strategies. |
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