Research On The Determination And Macroeconomic Impact Of The Equilibrium Exchange Rate Of The RMB

China’s macroeconomic fluctuations are closely related to the equilibrium exchange rate of RMB.As an important link of international economic activities,exchange rate deserves more and more attention.On the one hand,China’s internal economy is faced with a long-term situation of insufficient consumption,imbalance of international payments,and unbalanced internal economic development;On the other hand,the rise of trade protectionism represented by the "Sino-US trade friction" and the "theory of China’s exchange rate manipulation" further restrict the adjustment of the RMB exchange rate.Under both internal and external pressure,our country is bound to face the demands of economic internal and external equilibrium adjustment and the RMB exchange rate to maintain basic stability at a reasonable and balanced level.So what is the internal and external equilibrium condition of our country? What is the definition of the equilibrium exchange rate level of RMB? These issues need to be addressed urgently.Following the analytical framework of natural equilibrium exchange rate theory,this paper tries to answer the above questions on the basis of considering international competition,sustainable economic growth and convergence of foreign debt.This paper also analyzes the macro-economic impact of RMB balanced exchange rate imbalance,which is not only of great practical significance to our country to realize the path of economic and external equilibrium and the reasonable and stable exchange rate fluctuation,but also contributes to our country’s macroeconomic policy formulation and the reasonable implementation tool.In theory,this paper analyzes the determination of short-,medium-and long-term equilibrium exchange rates respectively.The short-term equilibrium exchange rate guided by static analysis is the exchange rate decision when the internal and external economic equilibrium is considered under the condition that the total supply(potential output)remains unchanged.The short-run equilibrium is transient.The determination of the equilibrium exchange rate in the medium term relakes the assumption of constant total supply in the short-term equilibrium.Economic growth at medium-term equilibrium is temporary.On the basis of variable potential output,the long-term equilibrium exchange rate is the exchange rate level that is balanced by the economic growth brought by technology and production factor input,that is,the exchange rate level when the convolutional economic growth and the extension economic growth in a country’s economic growth are balanced.The long-term equilibrium exchange rate level considers the balanced analysis of sustainable economic growth and economic growth momentum.It’s dynamic and sustainable.Then,based on the equilibrium determination,we further explore the natural equilibrium exchange rate theory model of RMB(CN-NATREX).In terms of policy research,based on the empirical results of RMB natural equilibrium exchange rate,this paper further uses TVP-VAR model to empirically test the impact of RMB exchange rate imbalance on macroeconomic fluctuations such as domestic price level,employment and economic growth.The study finds that the impact of exchange rate misalignment on macroeconomic fluctuations has obvious lag period differences,and is also obviously affected by the endogenous environment changes of exchange rate policy and the external shocks such as Sino-US trade frictions.The impact of exchange rate misalignment on prices is mainly reflected in the medium and short term.Exchange rate misalignment has a stable and persistent negative impact on employment,which increases the employment pressure in the home country and exacerbates the deterioration of the employment environment in the home country.The impact of exchange rate misalignment on economic growth is complex and has obvious time-varying characteristics,and the impact path has significant maturity heterogeneity.The exchange rate reform on August 11,2015 changed the direction of the correlation between exchange rate misalignment and economic growth,which is of great significance to China’s economic development.Sino-us trade friction has an important "amplifier" effect on macroeconomic effects,and its impact is amplified on the basis of the exchange rate reform on August 11,2015.This paper proposes a natural equilibrium exchange rate of RMB that can be seen in the long run,considers the long-term existence of international competition,emphasizes the internal economic equilibrium and external economic equilibrium,and deeps the market-oriented reform of RMB exchange rate.