Study On The Influence Factors Of Currency Internationalization In Stages And Its Enlightenment To RMB Internationalization

From a historical perspective,the rise of a country tends to enhance its level of currency internationalization.However,in majority of developing countries,especially emerging markets,the currency value is statistically insignificant,which is wildly incompatible with their national strength.This weakness,conversely,has accelerated the pace of currency internationalisation of these handful developing countries.China,as the world's second largest economy,the internationalised development of its currency,Renminbi(RMB),marks the practical demand of China's economic and financial globalization,as well as the inevitable outcome with the reform of the international monetary system.Since 2017,RMB's exchange rate has being stable,the negative trend of its devaluation and soaring capital outflow also tend out to be offset-which is to emphasise that it is time to bring back the reform of RMB internationalised process.This essay conducted a research on factors affecting the currency internationalisation in 22 countries in the period from 1999 to 2015,with a thoroughly studying in the features that currency internationalisation showcased in different stages.In addition,this essay delved deeply into the relation between currency internationalisation and the factors,which contributed to further phased-theoretical analysis around currency internationalisation.The research achievement also has a bearing on the goal setting and path selection of currency internationalisation for each phase.First of all,22 currencies have been categorized into three groups: international monetarises derived from mature markets,currencies of developed countries and currencies of developing countries.Based on a certain assumption,this essay treated above three groups as the representative of the currency internationalisation's later period,mid-term and earlier stage,respectively.Fully leveraged FGLS to analyse three factor models,this essay come up with-(i)At any stage,the economic strength of a country is one of the crucial factors.(ii)The scale of export has a negative impact in the early and middle term.(iii)Financial markets development plays a vital role in the early and middle term,particularly in the mid-term,their expansion is the foundation for further implementing currency internationalisation.(iv)In the middle stage,exchange rate volatility has active impact the internationalised process,while inflation is more significant in this stage,as well as later period.(v)Capital account opening-up is generating heat during the earlier period.Regarding this situation,this essay put forward the following ideas-(i)In every stage of currency internationalisation,the process is being activated as comprehensive national strength brightens.(ii)Financial market reform is an important condition for RMB's internationalisation.(iii)RMB exchange rate stays well-supported is being a driving force.(iv)Boost the open-up of capital account is a far-sighted,meaningful step for the internationalisation.