The Research For Currency Anchor Effect Of RMB And Its Influence Factors In East Asian Region

Following the continuous deepening of economic globalization,the financial and monetary cooperation which is mainly about exchange rate among East Asian economics is of great significance on the economic development and the enhancement of influence in the international political,economic and trade pattern to East Asian countries and regions.In recent years,China has gradually become the regional economic center in East Asia and has taken the lead in promoting the development of regional economic cooperation.Meanwhile,with the steady deepening of RMB internationalization,the RMB has also gradually played a more important role in international currency settlement,savings and other aspects.The 1997 and 2008 financial crises exposed the shortcomings caused by taking U.S.dollar as long-term anchor currency and the urgent demand to seek and establish a core currency in East Asia.So is the RMB a potential anchor currency in the East Asian region?The answer is yes.But at present the far-reaching impact of the U.S.dollar on the East Asian region will continue.If the RMB wants to play a core anchor currency role in the region,it will take a long time to develop and accumulate.Firstly,this article summarizes the exchange rate regime of the East Asian economies,the characteristics of the U.S.dollar anchor and the development of regional monetary cooperation,and also analyzes the historical progress and development prospects of the yen and the RMB as potential anchor currencies in the East Asian region.Secondly,by combining with China's own economic development as well as the external situation of the international economy,the paper focuses on the analysis of the internal and external factors of the feasibility of RMB becoming the anchor currency in East Asia.And then,based on the Frankel Wei model,it makes some improvement and SVAR method is used to empirically analyze the impact of exchange rate fluctuations of different basket currencies on the exchange rate of East Asian economies from July 21,2005 to January 19,2018.And on this basis,I select the appropriate variables and use the variable intercept fixed-effect panel regression method to analyze the influencing factors of the RMB currency anchor effect from 2007 to 2017.Finally,based on the theoretical and empirical analysis of the previous chapters,I put forward my suggestions on the monetary and financial cooperation in East Asia,the formation mechanism of China's exchange rate,the internationalization of RMB and the promotion of China's international financial status.The results of empirical analysis show that following the development of RMB exchange rate reform,RMB has some improvement on the monetary anchor effect in East Asia,but it still lags far behind that of the U.S.dollar.The change of the exchange rate of U.S.dollars will still have a long-term impact on the exchange rate of East Asian economies currency.In addition,for the analysis of the factors influencing the RMB anchor effect in East Asia,most of the variables passed the test under different confidence levels in four different periods.The current account balances between East Asian economies and China differ from each other.Interest spreads have a negative correlation with the currency anchor effect in the East Asian region.The differences between China and other East Asian economics on the current account of international payments,rate of interest have the negative correlation to the currency anchor effect of the RMB in East Asia and the difference of monetization has the positive correlation.However,at the present stage,the trade closeness between the two countries or regions does not show the promoting influence on the currency anchor effect of RMB in East Asian region.In general,China should continue to push forward the process of RMB internationalization steadily and promote monetary and financial cooperation actively and more deeply in East Asia.At the same time,we should further perfect the mechanism of exchange rate formation in our country,deepen the degree of marketization and improve the operation mechanism and supervision mechanism of domestic financial markets.Under the new economic normal,we should seek new points of economic growth,optimize the structure of China's international trade,and RMB enhances the more significant role in the three major currency functions,including settlement,reserve and investment in the international monetary system. As the world's largest developing country and the world's second-largest economy,China will also shoulder the responsibility and mission for mutual benefits and win-win results between the countries and regions of East Asia.