Research On The Impact Of CNY Exchange Rate Changes On Sino-US Import And Export Trade

The United States has become China’s second largest trading partner for several years.Although the huge American market and the rapidly rising Chinese market have brought great economic benefits to the two countries,the frequency of trade frictions has increased instead with the development of economic and trade relations between the two countries.And the United States has become the country with the most intense trade frictions with China.As a part of the economic and trade relations between China and the United States,trade frictions have changed due to the development of political relations and international situation.At the same time,the US government has always labeled China as a currency manipulator,and strongly urged the appreciation of CNY to weaken the competitive advantage of China’s exports.In 2018,the United States launched a trade war on the basis of a huge trade deficit,regardless of Chinese persuasion.Under such fierce trade frictions,whether the CNY exchange rate is a key factor of trade imbalance has become a hot topic of social concern and also the focus of academic research.This paper aims to explore the impact of CNY exchange rate on Sino-US trade and find the reasons for Sino-US trade imbalance.Based on the literature review,this paper first summarizes the evolution of CNY exchange rate system and the development of Sino-US trade frictions.Secondly,from four aspects of total trade volume,trade structure,trade dependence and trade balance,this paper studies the general situation of Sino-US trade in 22 categories of commodities in 2000-2019 based on HS commodity classification standard.Then,GARCH model is used to calculate the real exchange rate volatility between USD and CNY.Based on the import and export equation,VAR model is used to make impulse response and variance decomposition to further analyze the dynamic impact of CNY exchange rate on 22 categories of commodities of Sino-US trade.Based on HS commodity code classification standard,this paper studies the influence of CNY exchange rate on the Sino-US trade of 22 major commodities.This different perspective is one of the innovations of this paper.The research shows that: First,although the rise of CNY exchange rate will promote the trade surplus of some categories of commodities in China,it also has a restraining effect on the trade of a few commodities and has no obvious impact on the trade of other categories of commodities.Although the CNY exchange rate volatility has a depressing effect on Sino-US trade,it is not obvious.Therefore,the level of bilateral real exchange rates between USD and CNY is not a keyfactor in the imbalance between China and the United States.Second,the improvement of the US economic level has a positive effect on the trade surplus of some of China’s commodities.Even its promotion effect on individual commodity trade is higher than the exchange rate level.This shows that the development of the US economy itself may drive China’s export trade to the US,and the expansion of the Sino-US trade surplus may also be the result of the US economic development.Third,the promotion of the trade inertia of the two countries on the trade surplus cannot be ignored.As China continues to advance the process of reform and opening up,and export trade cooperation continues to deepen,China has become a key link in the global industrial chain.The support of the government’s macroeconomic policies,long-term stable cooperative relations,and the complementary industrial advantages of China and the US have made the development of Sino-US import and export trade stronger.Finally,according to the research conclusions,four relevant policy recommendations are given.