Further Opening Up Of China's Financial Exchange Rate Regime Choice

During the 90s of 20th century, exchange rate risks happened time and again, which impacted the exchange rate target area and made the fixed exchange rate difficult to continue, the exchange rate risks that happened were not casual. At the time when capital control loosened, the scale of capital flow increased, whenever there comes certain imbalance or evident fault in policy, the speculation capital will impact the fixed exchange rate. Under the circumstances that China has entered WTO, and economic gate will be gradually opened, exchange rate is the first important core in various economic varieties, because the status of various economic varieties under opening economy will finally be, to different extent, operation of opening economy from macro-economy to micro-economy in different fields. Finance globalization and liberalization call for the reform of our rigid exchange rate system. With the economic development, our macro situations are good enough to bear the instability from the exchange rate system reform. We should catch the chance but we have to pay attention to the macro-economics stability. Soothe reform should be step by step, take the choice of target zone and enhance the collaboration in Asia area in order to stabilize the exchange rate system. This thesis introduces exchange rate target zone system, often of the international exchange rate system reforms, and discusses the reality and the requirement of this system, after China opening her Capital Account. In the meantime, we analyze the problems and solutions in the theories and reality, while building this system.This thesis includes 4 chapters. Chapter 1 introduces the history of 20th century world exchange rate system and the present state. The author tries to find the motive of the exchange rate system development. Chapter 2 reviews the transition of our country's exchange rate system, especially by analyzing the function of current " floating exchange rate under supervision", pointing out the necessity of reform. Based on the Krugman model and foreign control and manage floating system of China, Chapter 3 concludes that exchange rate target zone system is more suitable to our country. Chapter 4 puts forward some relevant suggestions on how to deliver on the target zone system in our country...