Research On The Impact Of International Capital Flows On Chinese Prices

With the development of economic globalization,international capital flow has become a powerful engine to promote the global economic development,and it has also attracted the attention of all countries because of its important position in economic development.In 1978,with the opening up of China's reform and opening up,The financial field is also slowly opening to the outside world.As a result,the flow of international capital in our country is gradually speeding up,and the impact on our economy is becoming greater and greater,even to a certain extent affecting the formulation and implementation of financial policies in our country.Under the conditions of open economy,International capital flows and domestic prices are more and more closely linked,there is mutual influence,in 2008,the outbreak of the financial crisis in the United States,Most countries are involved in it,China is no exception,and it has a serious influence on the price of our country.Based on this background,this paper focuses on the influence of international capital flow on the price of our country.Firstly,this paper introduces the current economic development background at home and abroad,and summarizes the relevant literature on international capital flow and its relationship with price level,and then puts forward the research content of this paper.This paper expounds the connotation and related theor:ies of international capital flow,and on the basis of this,selects excess liquidity,foreign exchange account(FOFEE)and foreign exchange reserve(fer)as the measuring variables of international capital flow,Consumer priceindex(CPI)is a measure of pricelevel.Secondly,through collecting,collating,analyzing time series data from January 2006 to December 2016,this paper carries out descriptive analysis.The variation trends of excess liquidity,foreign exchange account for foreign exchange,foreign exchange reserve and consumer price index are observed.At the same time,through the stationary test Johansen cointegration test,the vector autoregressive Var model is constructed by using stata 14.0 software,and the empirical analysis of the problem is carried out.The results show that the excess liquidity has a great contribution to the price level,which affects the price level.The main factor is that foreign exchange and foreign exchange reserves have no significant impact on price level.Finally,on the basis of theoretical analysis and empirical analysis,This paper puts forward countermeasures and suggestions to stabilize price level by using international capital flow in five aspects:actively broadens the channel of capital diversion by adjusting the economic structure;deepening the financial market reform,actively developing the capital market;perfecting the financial regulation and control,establishing a supervisory and early warning mechanism for international capital flows;balancing the balance of payments,reforming the foreign exchange management system;strengthening international cooperation and exchange,promoting RMB internationalization process.At last,the paper summarizes and prospects the research in this paper.Therefore,this paper not only enriches the existing research on international capital flow,It is of guiding significance to stabilize the price level of our country.Continue the research to provide reference.