Analysis The Influence Of RMB Exchange Rate Fluctuation On China’s Trade

From the1990s, China’s import and export trade appeared deficit only in the1997Asian financial crisis and financial crisis in2008, the rest of the year were surplus. Atthe same, since the revaluation in July2005, the RMB exchange rate has been in aconstant state of appreciation, and China’s import and export trade increasing was notconsistent with the reduce phenomenon of traditional international trade theory research.Capital and trade are all keep expanding station in these years. So this article is analysisthe RMB real effective exchange rate on China’s import and export trade, J curve effect,Marshall-lerner condition.In this paper, the research is carried out mainly through two ways. On the one hand,the paper studying on the theory of the exchange rate for import and export trade,determining the inevitable relation between exchange rate on the import and exporttrade, conclude the influence mechanism and the function of the balance of trade on theclassical theory of exchange rate. On the other hand, on the basis of the classical theory,the RMB real effective exchange rate on China’s import and export trade to do empiricalresearch. After the2005exchange rate revaluation, it make the impact of RMB realeffective exchange rate on trade way and the effection clear, and the difference betweentheory and empirical. The paper puts the reasons of the existence of the differencesforward. For analyzing at different times in different countries, the influence ofexchange rate on trade import and export provide a new reference argument, to someextent, it enriched and developed the theory of exchange rate on the import and exporttrade relations. In this paper, it considers the factors of the RMB real effective exchangerate, in addition to, it also joins the residents income at home and abroad and foreigndirect investment in foreign exchange reserves. It sets up the quantitative models toanalysis the number of results achieved. The validation of the empirical research ontheory study can enrich the theory of trade balance.In this paper, the empirical study shows that the RMB real effective exchange rateand import and export trade in our country has a long-term equilibrium relationship, andit can quickly adjust to equilibrium in a short time. The RMB real effective exchangerate has negative effects on the import and export trade, and the influence on theimport trade is greater than the export trade. RMB real effective exchange rate onChina’s import and export trade has a certain impact, but the domestic and foreignresidents’ income is the main factors influence on import and export trade. Foreign reserves have positive effect to the export trade and foreign direct investment also has apositive effect of import trade. The RMB real effective exchange rate is the Grangerreason of import and export trade, and the increase of import and export trade canpromote the appreciation of the RMB.Many domestic and foreign research about the exchange rate for import and exporttrade impact analysis is selected in the RMB against the dollar. And this paper chooseRMB real effective exchange rate, it can be more comprehensive reflect the influence ofRMB exchange rate on trade import and export.