The Research On The Influential Factors Of RMB Cross-border Settlement

Since the financial crisis in 2008,the world economy continues to weaken.The dollar,euro and yen and other international currencies have devalued on a different level.The current international monetary system’s disadvantages always appear.At the same time,China became the second largest economy in the world.The proportion of import and export trade continues to rise.The value of the RMB remains stable and better during the financial crisis.The RMB becomes the hard currency in the world market,and this provides an opportunity for the internationalization of the RMB.The RMB cross-border settlement is the foundation of the RMB internationalization.China launched the RMB cross-border trade settlement business in 2009 and the RMB cross-border direct investment settlement in2011.China made great progress 0ver several years.The RMB becomes the sixth largest pay money accounted for 1.68%.But there is a big gap compared with the dollar,euro and yen and other major international currencies.There are all sorts of problems in this business at the same time,and it go gradually into the bottleneck period.Therefore,we analyze impact factors based on the cross-border RMB settlement situation and provide policy and advice which is definitely necessary.First of all,the paper studies the RMB cross-border settlement definitions and related RMB cross-border settlement theories.Then it divides he cross-border RMB settlement status into the cross-border RMB trade settlement,the cross-border RMB direct investment,the RMB international bonds,RQFII,the RMB foreign exchanges trade,the RMB cross-border settlement distribution,related supporting facilities and so on.There are many problems in this business,such as slow domestic reform,partly opened capital account,fixed trading habits,difficultly changed neighboring countries,the lagged offshore market,the insufficient investment products supply,lacked backflow channels,imperfect clearing system and so on.The paper analyzes this paper from economic and trade,the RMB exchange rate,the interest rate difference between domestic and overseas the RMB offshore market development and policy factors.The paper uses multiple linear regression equation based on the monthly data from 2012 to 2016.Then it makes empirical research on the factors which influencethe cross-border RMB settlement through the ADF unit root test,cointegration test and granger causality test.It is concluded that economic and trade,the RMB exchange rate,Shanghai interbank teardown interest rate,the RMB offshore market development and policy factors influence the RMB cross-border settlement,and all the factors effect the RMB cross-border settlement on a different level.Then it refers the international experience of the dollar,yen and euro.According to the theory,the present situation and the empirical analysis,the paper presents promoting the domestic reform,completing financial liberalization,the development of currency swap agreement,promoting people’s participation in international settlement,developing more RMB financial products,the development of the RMB offshore market,the perfection of the mechanism of the RMB reflux overseas,setting up the RMB international settlements system,which promotes the RMB cross-border settlement business development.