The Study On The Impact Of RMB Appreciation On Interest Rate

With the rapid economic development, the RMB in the international arena began to play an important role. RMB appreciation has many causes, but in general can be divided into internal factors and external factors.First, the external factors. RMB appreciation in the external pressure force in the international public opinion in Japan, as anxious vanguard role, and America's interests and the government is constantly pressuring the European Union concerned over the euro will bear the consequences of the dollar, but they want to trade with China to maintain good relations, so the issue of RMB appreciation is more low-key performance. Second, the internal factors. Include the following:(1) increasing foreign exchange reserves; (2) a higher rate of economic growth; (3) long-term balance of payments is in surplus; (4) higher interest rates rising.If the RMB has appreciated at an appropriate interval, such as the economy in China will ease the contradiction between international trade and other benefits. However, at the wrong time if the RMB to appreciate sharply, not only can not effectively improve the country's economic situation, China will also bring huge financial and real economic damage.This article mainly through one dollar monthly average of RMB and the 1Y varieties last trading day of each month of SHIBOR between November 2006 to December 2010 to show that China's exchange rate and interest rates do not exist in mutually reinforcing.After the exchange rate and interest rate relationships and analysis of the causes, the paper presented under the specific conditions of the policy recommendations of the following points:first, the optimization of China's interest rate policy. The full market rate interest rates can play in the regulation of this important leverage role of resource allocation, but also making China the central bank's monetary policy more obvious, which is to promote economic development in China has great practical significance. Second, the optimization of China's exchange rate policy. Such as efforts to create a sound foreign exchange market; steadily promote the reform of foreign exchange settlement system; deepening reform of RMB capital account convertibility.