A Study To Verify The Asymmetry Of RMB Real Exchange Rate Adjustments

Considering the imbalance of global economic structure and monetary over-development,China's domestic economy is virtualized and leveraged,this paper makes a theoretical analysis on the transmission mechanism of domestic prices in China.It changes the tradition of using M2 as the price measure with the wage level.At the same time,according to the wage in the social system can not be free to adjust lower,the proposed domestic prices effect on the real exchange rate changes in the transmission of a one-way limit will cause the actual exchange rate adjustment asymmetry.Based on the mainstream exchange rate model,this paper chooses the behavioral equilibrium exchange rate model as the frame and combines with the theoretical analysis to build the empirical model to estimate the real exchange rate of RMB.The model uses the real effective exchange rate of RMB from the Bank for International Settlements as the real exchange rate,Use trade freedom,trade openness,manufacturing wage,domestic interest rate decrease the world average interest rate and foreign net assets as independent variables.Data is from 1996 to 2013.Using the ADF test to determine the variables for the first order single and using the cointegration analysis of the real exchange rate to determine the long-term equation.The influence of the short-term shocks of the independent variables on the real exchange rate is investigated by the impulse response function.Based on the long-term relationship between the real exchange rate and its respective variables,the H-P filtering method is used to obtain the long-term equilibrium value.The long-term equilibrium value of the real exchange rate is obtained by taking the long-run equilibrium value of the independent variable into the relational equation.Then the model makes a comparison between the two reasons,measure the long-term imbalance degree.Then make a further analysis of real exchange rate adjustment.First,divide the imbalance of the real exchange rate into enlarge of the imbalance and decrease of the imbalance.Respectively compared undervalued and overvalued,got the actual exchange rate relative to the previous one phase of the expansion and callback efforts.Empirical results show that the real exchange rate of RMB does not appear in the long-term serious imbalance,the largest quarterly imbalance within 2%.The results show that the imbalance of the RMB real exchange rate expansion efforts is 106.7%higher than the underestimated state.The unbalanced callback efforts of the RMB real exchange rate overvaluation is 61.9% lower than the underestimated state.Which indicates that the real exchange rate is obviously restrictive and validates the hypothesis of theoretical deduction.Finally,this paper bring forward some suggestions on RMB exchange rate policy: Establishing the market decision mechanism of nominal exchange rate;Restricting the growth of wage,house price and asset price level;Increasing the floating range of exchange rate;Implementing market economy Of government intervention;...