| Simple as the fact that money bears the nature of silver and gold，each country issueits own paper currency, fiduciary currency and the rapid development of electroniccurrency such as bitcoin, alt the process above involve an exchange ratio betweendistinguish kinds of currencies among countries. From the ear of gold standard, to thetime of linkage between dollar and gold, all the way to the stable exchange rate ofdollar, and finally，till the floating exchange rate due to the collapse of Bretton WoodsSystem, currency ratio always remains a hot topic in Economics. The theory ofpurchasing power parity and thetheory of interest rate parity both describe what idealexchange ratio should be, but under the system of floating exchange rate, expectationbegins to have more impact on the exchange rate movements and capital lfow,therefore, various interpretation theories regarding to the characteristics of expectationitself have appeared. The rising of Behavioral ifnance is resulted by the strictassumption of traditional economics, and thus key information has been ignoredduring the process. Behavioral finance believes market participants arc not rationalunder most circumstances, which may leads to different types of expectations betweenlong term and short term, even results in the heterogeneity of coexisted marketparticipants. In the short term, expectation formation system may implies formationmethods of such expectation, so the variance of exchange rate based on expectationcan be humanly controlled. Exchange ratio market in China has aroused from scratch,also even till now it is under the control of Chinese government. Facing the pressureof international govcrnancc and the demands of loosen controls，market mechanism ofRMB exchange ratio is expanding and perfecting. However, central bank is notrelieved to have exchange market developed in free style since domestic andinternational economic situation is beyond complex. Nowadays, Chinese central bankand the energy of Chinese economy play a critical international position, whatbehaviors China would take might draw high tensions during market participants. In this essay, the factor of variance middle price is included to prcdict the fluctuation ofexpectation, using methods of Simultaneous equations and TSLS, this essay provedthat middle price intervention lias significant impact on exchange rate expectationduring332trading days in2012and2013，also the variance of middle price could bethe guidance of exchange rate expectation. More importantly, the variance ofexchange rate expectation is the major reason for the intervention of Chinese CentralBank. This essay proves that dollar index. State Housing boom index areunidirectional leading variables of middle price using the methods of Grangercausality test and the middle price is the unidirectional leading variable of QFILConsumer confidence index, HSBC employment index and PMI index. Since the factthat Chinese Central Bank can pilot the expectation of exchange rate and further affectthe direction of exchange rate fluctuation, however, this essay believes the solutionfor RMB exchange rate dilemma is beyond the formation mechanism of cxchangc rate，the dilemma is the result of unbalance to the macroeconomic, not the cause. ThinkRMB exchange rate as a method for regulation is not a wise way to solve theproblems, but a way to harm the situation. |
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