Analysis On The Policy Of The Regulatory Arbitrage In The Background Of RMB Settlement Of Cross-border Trade

The outbreak of the financial crisis in2008makes the drawbacks of the existing international monetary system exposed.Under this background, Chinese government puts forward the "RMB internationalization" strategy, opening the RMB settlement of cross-border trade and direct investment. At the same time when the RMB settlement of cross-border trade is in the rapid growth, some enterprises take various forms using the RMB settlement of cross-border to arbitrage, which makes more "hot money" flows, but also restricted the development of RMB settlement of cross-border trade.Based on the definition of arbitrage for RMB settlement of cross-border trade, this paper firstly elaborated related literatures and theories on the RMB settlement of cross-border trade and arbitrage, and analyzes the mechanism that international arbitrage capital affects the financial security, macro-economic and currency internationalization. And then this paper analyzes arbitrage model and reason in the market between Chinese mainland and Hongkong. Because of the differences of exchange rate price and interest rates between the offshore market in Hongkong and the offshore market in mainland, in the absence of real trade or finance background, enterprises use RMB settlement of cross-border trade to earn exchange rate and interest rate price difference Then, based on our country’s actual situation this article analyzes the impacts caused by arbitrage on financial field, the domestic economy and the internationalization of RMB in the background of RMB settlement of cross-border trade, and points out the necessity of supervision. Finally, it analysis of the current situation of China’s regulatory arbitrage under the background of RMB settlement of cross-border trade and existing problems, and puts forward suggestions to solve the problems.