Empirical Study On Sino-US Trade Surplus, Appreciation Of The Renminbi And The Choice Of Exchange Rate Regime

With China’s rapid economic development, as well as Europe and the United Statesunder the influence of the financial crisis, has been in a relatively depressed state, andforeign trade surplus is growing appreciation of the RMB is facing great pressure. Somecountries also have ulterior motives to accuse our government there is a serious currencymanipulation. In order to cope with stress, our country to change the previous pegged tothe U.S. dollar fixed exchange rate system, and the implementation of the regulated,managed floating exchange rate regime based on market supply and demand withreference to a basket of currencies. Based on this, the paper Empirical Study on RMB tothe U.S. dollar nominal exchange rate fluctuations on the Sino-US trade, which hit back atthe foreign exchange rate of RMB questioned theoretically, improve the RMB exchangerate formation mechanism has important practical and theoretical significance.Based on the theory, the status quo of Sino-US trade, the appreciation of therenminbi facing internal and external pressure, as well as China’s exchange rate systemreform on the basis of empirical Sino-US trade a systematic analysis. The cointegrationequation test results can be seen, China’s trade surplus with the United States and RMB/U.S. dollar nominal exchange rate is a negative correlation between long-term, China cannot "manipulating" the RMB against the U.S. dollar nominal exchange rate to increasetrade surplus; error correction model results also verify the nominal the exchange rate isnot Granger cause of the Sino-US trade balance, China does not exist by "manipulating"the nominal exchange rate of the fundamental motivation. The variance decompositionanalysis shows that the expansion of Sino-US trade surplus, in addition to trade shocks, toa large extent, also affected by the impact of the United States’ own economicdevelopment and domestic prices. Finally, the pressure of RMB appreciation persists, putforward some suggestions on how to ease the pressure of RMB appreciation.Recommendations include how to reduce China’s current trade surplus and huge foreignexchange reserves, and how scientific use and management of existing foreign exchangereserves. In addition, this chapter focuses on deepening the reform of the RMB exchangerate regime points, including further improve the RMB exchange rate formationmechanism, is committed to a policy of gradual exchange rate adjustment method, andactively promote the process of internationalization of the RMB.