Choice Of The Direction And Path Of The Exchange Rate System Reform In China

The world opinion headed by America and Japan has been setting off a tide of demanding appreciation of RMB. Thus the RMB exchange rate has been becoming the focus of debate among domestic and international scholars. But the more important thing is which kind of exchange rate regime RMB should choose. China's present exchange rate regime, so-called "manage floating regime"is actually a fixed rate regime pegged to US dollar which will expose more and more defects and become unsustainable during the process of China's further opening-up. Therefore, RMB exchange rate regime needs to be reselected.Theory abroad about the choice of exchange rate regime is varied. At present there is no consensus on the subject that which kind of exchange rate regime is the optimum one for one country. Also each kind of existing exchange rate regimes all has its own supports. The domestic argument on the choice of RMB exchange rate regime is also varied. No single exchange rate regime is right for all countries or at all time.Although all of the theory can't give us a clear answer on which kind of exchange rate regime RMB should choose, we can get some revelation from it. This paper makes thorough probe into short-term, midterm and long-term choice of RMB exchange rate regime. RMB exchange rate regime will finally choose floating exchange rate regime with the realization of the free flow of international capital. The exiting way should be gradual and China should not be hurry to proceed to the innovation of exchange rate regime because it is not qualified to float freely over a long time. What China should do now is to take a series of measures for the preparation of exiting from the present exchange rate regime. In midterm, exchange rate target zone regime is the best...