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Empirical Analysis Of The Impact Of Exchange Rate Volatility On Bilateral Trade Between China And The EU

Posted on:2015-12-04Degree:MasterType:Thesis
Country:ChinaCandidate:X M JiangFull Text:PDF
GTID:2309330431986733Subject:Finance
Abstract/Summary:PDF Full Text Request
July21,2005, China abolished the dollar peg system to the implementation of market supply and demand with reference to a basket of currencies has a managed floating exchange rate regime. Since then, the RMB appreciation trend showed unilateral, but the expansion of exchange rate fluctuations, exchange rate risks attendant has intensified. Greater exchange rate risk may hinder the development of foreign trade, but some scholars believe that its impact is not necessarily negative, sometimes even play a facilitating role.In this paper, theoretical research and empirical research method of combining analyzed2003M1-2012M12bilateral trade between China and the EU, the level of exchange rate changes and exchange rate volatility characteristics, in order to trade on the basis of separation theory Ethier, respectively, from the direct and indirect paths path explores the impact of exchange rate volatility on the import and export trade. Empirical analysis, this study used two methods EGARCH and standard deviation calculated yuan-euro exchange rate volatility. Finally, Microfit software is used in co-integration test, and error correction model is used to analyze the impact of exchange rate volatility in ARDL structure of export trade. The results show that exchange rate volatility and exchange rate reform policies have a significant impact on China’s export trade, but the impact on the EU’s export trade is not significant. Based on this, the article proposes to maintain the stable development of China’s foreign trade policy recommendations.
Keywords/Search Tags:exchange rate volatility, the bilateral trade, exchange rate reform, ARDLmodel
PDF Full Text Request
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