The Influence Of U.S. Quantitative Easing Monetary Policy On Foreign Trade Of China

Since the21stcentury, the rapid development of economic relations betweenChina and America has aroused extensive attention worldwide with gradualopening-up of China. Besides, the bilateral economic relation between these twocountries has become the most significant relation among economic systemnowadays. In1997, the United States became the largest export market of Chinaover Japan and in2004, America turned into Chinese second biggest trade partner.Therefore, in2010, the two sides became mutual greatest trade partners. Under theeconomic globalization and district integration condition, the trade scale of the twocountries is expanding. Meanwhile, the interdependence of China and America hasdeepened step by step and the impact of U.S. on China has escalated. The economyof China has been influenced seriously because of the America’s financial crisissince2008. As the financial crisis escalated into a large scale, there was a recessionin demand in America. As a result, the export trade of China has been affectedsignificantly because export trade was one of the most important impetuses of China.Hence, there was a more profound shortfall in economic growth in China. Onaccount of low-tech and low price, low cost has got into the superiority of exporttrade of China and the depreciation of US dollar has weakened the advantage of ourexport products, cut down the occupancy volume of export in the world. As a result,it will bring about profit squeeze of foreign trade enterprises. Under severecircumstances, the foreign trade of China are in confront with unprecedentedchallenge. Therefore, China must adopt measures to protect the foreign trade so thatit can provide sound and steady circumstances for the trade. Based on background and reason above, I introduce the paper’s significanceand background and make innovations based on previous research in addition. Andthen, recommend the channel for quantitative easing monetary policy affectingforeign trade of China. Use the transmission mechanism of unconventional monetarypolicy as theoretical foundation, make introduction of effect for monetary policy onChinese export trade, do empirical analysis on export trade of China and make aconclusion of majority factors that affect export trade as a result. Meanwhile, I stillput forward some measures to handle with problems. The government shouldoptimize export structure and promote traditional industries to upgrade withhigh-tech. Stimulate domestic demand so as to establish internal and externalequilibrium strategy and expedite steps to construct credit system of enterprises.Take an active participation to set international standard in order to provide stableenvironment for Chinese development.This text focuses on the impact of the quantitative easing monetary policy andcarries on theoretical and empirical research. Afterwards, the article will reach aconclusion about the effect of foreign trade that quantitative easing monetary policybrings about and put forward some measures to deal with the problems amongimport and export trade in China.