The Experimental Research Of RMB Equilibrium Exchange Rate

Since the outbreak of financial crisis, the appreciation of the RMB has gradually became the focus on attention of the world. The pressure on appreciation of RMB constantly increasing, some politicians have called for the appreciation of RMB on different occasions. Under the expectation on the appreciation of RMB, a large number of hot money flow to major stock market in China and Asian. The price in domestic coastal cities rises too high. Chinese foreign exchange reserves have raised to 30447 billion dollars in March 2011, our economy also faces the great inflations. At the same time, with the rapid development of China, the RMB equilibrium exchange rate causes the concern of the international academic and becomes a hot issue. According to the economic development level of our country and the international balance of payments, we reform and improve the RMB exchange rate formation mechanism, and on the base, we can carry out the reform on RMB exchange rate better. It is great significance for us to study on RMB equilibrium exchange rate, we can maintain the fluctuation of RMB exchange rate, promote the basic balance of international payment, stable the finance market and maintenance macroeconomic in China.At first this paper expounds the foundation theory of research, reviews the research on equilibrium exchange rate from domestic to abroad. Then introduces two kinds of mainstream theories of equilibrium exchange rate——the traditional equilibrium exchange rate theory and emerging equilibrium exchange rate theory, analysis the different model assumptions and the applicable scope. Construct the equilibrium exchange rate model on RMB, make a empirical test. Using cointegration analysis and error correction model, on the base of the variable pulse response analysis and statistic test, we draw the conclusion. Finally in the theory and on the basis of empirical research, we analysis the system of the RMB exchange rate and exist defects, put forward the policy to perfect the mechanism of RMB exchange rate, then point out that we should strengthen the supervision and risk prevention, to increase the flexibility of the RMB exchange rate, and that the scope of RMB appreciation control 4%-9% the best, resulting on improving and perfecting the mechanism of RMB exchange rate in the macroeconomic.