Research On The Influence Mechanism Of RMB Internationalization On The Stock Market

The internationalization of RMB is the inevitable outcome of China’s sustainable economic development;At the same time,as a financial market that promotes and suppresses each other,the internationalization of RMB will inevitably drive and must develop the internationalization of financial markets.During this period,China’s stock market will inevitably have a linkage impact corresponding to the development stage of RMB internationalization.In this paper,we use the index(RMBII)that is available for calculation and analysis and other recent relevant data that can be collected since 2010,which has really started to enter the internationalization system,to establish a multi-factors regression model for four stock market indexes,and analyze the impact of RMBII on China’s stock market from the growth rate of the index and the volatility of earnings,as well as the possible impact channel mechanism.The empirical results show that at this stage,the RMBII directly promotes the growth rate and return volatility of the stock market;The intermediary effect shows that RMBII will affect the stock market through the transmission channels of exchange rate,interest rate,M2,inflation and foreign direct investment,but the transmission channels of its impact on four stock markets are slightly different.Specifically,the main board market is more sensitive to interest rates,while the GEM market is more dependent on foreign investment.Among them,the Shenzhen stock market is also sensitive to inflation,and the HS300 stock markets are also sensitive to foreign exchange rates and M2.This shows that the impact of RMBII on blue chip stocks is mainly determined by the changes in asset allocation costs,while the impact of science and innovation stocks is mainly determined by the degree of market internationalization and the width of financing channels.In addition,this paper has made benchmark regression robustness analysis tools for key indicators and interaction effects as robustness analysis tools for influencing channels,both of which have obtained relatively consistent results.This paper provides some reference for relevant policy researchers in China to improve and upgrade the risk early warning supporting mechanism in advance.