The Pass-through Of RMB Exchange Rate Changes And Fluctuation To Chinese Commodities’ Export Price

Since the reform of RMB exchange rate formation mechanism on July21,2005,the RMB exchange rate is rising. Since April16,2012, inter-bank spot foreignexchange market against the dollar transaction value fluctuation has ranged from5‰to1%and the RMB exchange rate fluctuation has expanded further. So the RMBexchange rate changes and fluctuation must have influence on Chinese foreigntrade.About this problem, few studies tried to do empirical research and givecountermeasures to Chinese commodities’ export prices from the prospective of theRMB exchange rate changes and the RMB exchange rate fluctuation.This paper analyzes the influence of the RMB exchange rate changes andfluctuation on Chinese commodities’ export prices from March2002to January2012and the asymmetry of the influnce of RMB exchange rate changes and fluctuations onChina’s commodities’ export prices, based on foreign exchange uncomplete transfertheory and Fabiosa (2002) hypothesis. First, we measure the value of exchange ratefluctuation through the EGARCH model,and mesure and analyze the price index of9kinds of SITC1digits classification of goods and four types of commodity accordingto the technical classification, establish time series model, through the Johansencointegration test and the error correction model, we test the long-term and short-terminfluence of the RMB exchange rate changes and fluctuations to the price of exportcommodities.The result shows that:firstly, the influence of the RMB exchange ratechanges on the commdities’export price is greater than that of the RMB exchange ratefluctuation, the influence of the manufacturer cost on the commdities’ export price isgreater than foreign demand; secondly,the influences of the RMB exchange ratechanges on the different commodities’ export prices are different, the influence on aportion of commodities is uncomplete transfer and super transport, the manufacturedgoods have stronger pricing power, the relationship of the RMB exchange ratefluctuation and most commodities’ export prices is negative and small; thirdly, thereis asymmetry pass-through of the RMB exchange rate changes and the RMBexchange rate fluctuation to commodities’export price between before and afterexchange reform,the effect of the RMB exchange rate changes on the export pricesweaks,the effects of the RMB exchange rate fluctuation on different coommoditieshas different changes;fourthly, there is a significant delay effect of the RMBexchange rate changes and the RMB exchange rate fluctuation to commodities’export price; fifthly, compared with low-technology commodities, middium-techcommodities and resource-dependent commodities,high-technology commditiesimprove their international competitiveness and ability to resisting risks,the ability toresisting risks is relevant with the content of technology in the commodities.Finally, this paper puts forward some policy suggestion to improve Chineseforeign trade structure and develop the foreign exchange market.