The Statistical Analysis Of The Rmb Exchange Rate Changes And Policy Options

Since Asia financial crisis exploded in 1997, it shook the whole world. Meanwhile the tendency of RMB exchange rate has come to the highlight of international finance. At the end of 1999, China made a significant progress in a serious of negotiations about its access to WTO. In Oct. 2001, China entered WTO. With the deepening reform of economic system and the further opening towards outside, the world has greatly concerned on the tendency of RMB exchange rate -appreciating, devaluating or remaining stable. At the same time, how to keep the balance of economy by efficiently using the adjustment instrument of exchange rate has become the emphasis of economic construction in china.First of all, the paper makes a statistical analysis on the changes of the RMB exchange rate since the time of economic reform and opening towards outside. The author has a research on the stage characteristics of the changes of RMB exchange rate and the causes of changes, and furthermore, takes special researches on four factors - the trade effect, introduction of foreign capital, domestic price and the monetary policy - which are consequently affected by the changes of exchange rate. On the basis of that, the author tries to find out the characters of the changes of RBM exchange rate and think over the shortcomings of the adjustment standard in the changes of RMB exchange rate. Then the author brings forward the opinion that the formation and adjustment of RMB exchange rate need equilibrium exchange rate. Secondly, by comparing and analyzing the western equilibrium theories of exchange rate ,the author attempts to build up the equilibrium exchange rate model of RMB, and calculates the equilibrium exchange rate of RMB from 1979 to 1999 by modern econometric methods - co-integration and H-P filter. Through analysis on the reasonableness of the level of RMB exchange rate, the author draws the conclusion that RMB exchange rate has experienced undervalued period twice and overvalued period three times. Finally, the author, in respect of the policy choice of RMB exchange rate, presents the view that the system of a single, managed floating exchange rate should be a reasonable option to the system of RMB exchange rate. On the basis of the analysis on the drawbacks in the forming mechanism of RMBexchange rate at present, the author designs the general frame of the mechanism of RMB exchange rate under the system of a single, managed floating exchange rate and proposes corresponding reform measures and policy suggestions.