Research On The Impact Of RMB Exchange Market Pressure On Real Estate Prices

The RMB exchange rate and real estate prices have always been important economic variables related to China's national economy and people's livelihood.Since the "721" exchange rate reform in 2005,the RMB exchange rate has experienced unilateral appreciation,depreciation pressure accumulation after the United States has withdrawn the quantitative easing policy,bilateral fluctuation after the "811" exchange rate reform in 2015,and both CNY and CNH fell past 7 against the US dollar under the Sino-US trade friction.While the real estate market has maintained a rapid growth since the housing system reform in 1998,and the upward trend has been eased under a series of regulation policies.International experience tells us that under the influence of short-term international capital flows,there is a linkage between the foreign exchange market and the real estate market,and it may trigger currency crisis in extreme cases.Therefore,an in-depth study of their relationship will not only help maintain the RMB exchange rate at a reasonable and balanced level and promote the orderly development of the real estate market,but also provide an important basis for the prevention of currency crisis.The impact of RMB exchange market pressure on real estate prices has obvious asymmetry,when under the appreciation pressure,the degree of influence and volatility are large,and the depreciation shock can still increase the growth rate of real estate prices in the beginning,while the impact under the depreciation pressure is very weak.This has much to do with the intermediary role of short-term international capital flows.On the one hand,the impact of RMB exchange market pressure on short-term international capital flows also exabits asymmetry;on the other hand,the short-term international capital flows are procyclical.The impact at the points of currency crisis are generally the same,but under the currency crisis of appreciation,RMB exchange market pressure has negative impact on real estate prices,and the short-term international capital flows have stronger procyclicality.Finally,this paper believes the probability China will repeat Japan's bubble crisis is extremally low and proposes policy recommendations from the three aspects of foreign exchange market pressure diversion,short-term international capital flow monitoring and real estate market regulation to achieve a win-win of stable exchange rate and stable real estate prices.