Periodic Analysis Of Currency Internationalization And Research On Network Externality And Exchange Rate Impact

The experience of major international currencies shows that currency internationalization is a long-term,continuous and phased process.As the degree of RMB internationalization continues to increase,it is necessary to consider the phased changes that will occur in the development of RMB internationalization.In order to study the periodic differences of currency internationalization,analyze the core influencing factors of currency internationalization.Based on the three major currencies functional indicators of 11 sovereign currencies from 1975 to 2017,the paper divides the international currency into four stages by data characteristics and K-means clustering method.Using the Bayesian model averaging method to study the influencing factors in different stages,the results show that there are obvious stage differences in currency internationalization.The influence of network externalities and currency confidence is significant in all stages and increases with the increase of internationalization.Fundamental factors such as politics are more influential at a stage of lower internationalization.To realize the transformation of the RMB from being internationalized to the initial stage of internationalization,maintaining a high level of economic and financial development is an important foundation.Improving network externalities and maintaining currency confidence are the keys to further advancement.To further study the dynamic impact of network externalities and exchange rates on currency internationalization,vector autoregressive or panel vector autoregressive model were constructed on international reserves,international bonds,and exchange rates.The results show that currency inertia has the highest degree of explanation for currency internationalization fluctuations,while horizontal network externalities and exchange rates have lower degrees of explanation.Increasing the currency inertia,especially the inertial impact of the international reserve share,is the key to achieving the staged development of RMB internationalization.Although the appreciation of RMB is beneficial to RMB internationalization,its impact is relatively limited.