A Research On The Equilibrium Exchange Rate Of RMB:a BEER Approach

China's macro-economic equilibrium has a profound impact for the world economy to achieve equilibrium.Exchange rate is an important economic variables and play a role in economic development.Should the Yuan appreciate to what level?This study has an important practical significance for the equilibrium exchange rate of RMB.This paper introduces the related concept,the theory of equilibrium exchange rate and measure,and choose BEER to measure the RMB equilibrium exchange rate.BEER is the basic economic variable that affects the real exchange rate from the statistical significance to find the co-integration relationship between the real exchange rate and various exchange rate determinants.Based on the national conditions,the author uses the ADF unit root test,HP filter method and other measurement methods to construct the RMB equilibrium based on the actual effective exchange rate,using labor productivity,net export,government expenditure,trade openness,foreign net assets and central bank intervention index as the basic economic variables.And then calculate the level of China's RMB exchange rate.The study found that the actual effective exchange rate exist overvaluation and underestimation of Over-overestimation occurred mainly during 2000Q4-2003Q1,2005Q4-2006Q1,2008Q1-2009Q3,2013Q2-2013Q4 and the entire 2015.Underestimation occurred during 2000Q1-2000Q3,2003Q2-2005Q3,2006Q2-2007Q4,2009Q4-2013Q1 and 2014Q1-2014Q3.Overestimation and underestimation are not significant,the maximum is only 8.3%.On the basis of predecessors,this paper chooses several factors with important influence as variables and consider the central bank's intervention in this paper,then draws the relationship between the RMB equilibrium exchange rate and the influencing factors.Finally,the author suggested that the Chinese government should promote industrial restructuring and optimization,reduce dependence on external demand,exchange rate policy and monetary policy coordination,strengthen capital flow monitoring,combat hot money inflow,promote cross-border RMB settlement and RMB internationalization.