Empirical Study On RMB Pricing Ownership In Onshore Market And Hong Kong Offshore Market

The offshore RMB market in Hong Kong is a key strategic deployment in the process of internationalization of the RMB.In recent years,with the gradual implementation of the internationalization of the RMB,the scale of RMB circulation in the offshore market in Hong Kong has grown to become the largest in the world.After the emergence of CNH’s immediate fixing price,it further promoted the development of the offshore foreign exchange market in Hong Kong.In the course of the internationalization of the RMB,various challenges will be encountered.From the success of international currencies such as the US dollar and the British pound,it can be found that an offshore market that continues to develop well and has a stable interoperability with the onshore market is promoting a national currency.International recognition is crucial.At present,the focus of China’s financial reform is on the management of foreign exchange reserves and the pricing mechanism of the RMB exchange rate.It is also a very important period for the internationalization of the RMB.The deepening of financial reform will make the offshore and onshore markets more closely linked.Therefore,we must adjust the pricing mechanism of the RMB exchange rate.Coordinating the interconnection between the onshore market and the offshore market in Hong Kong will help provide valuable experience for the sound development and interconnection of offshore markets in Taiwan and London.Nowadays,the relationship between the onshore market and the offshore market is becoming increasingly close.This paper studies the pricing rights of RMB in onshore and offshore markets,and provides relevant policy recommendations for China to maintain exchange rate stability and promote the market-oriented reform of the RMB exchange rate.This paper analyzes the exchange rate formation mechanism in the onshore and offshore markets,the link between the onshore and Hong Kong offshore RMB exchange rates,and the interplay factors between the onshore exchange rate and the offshore exchange rate,and through the quantitative analysis method for 2015“8·11”An empirical study was conducted on the linkage relationship between theonshore exchange rate and the offshore exchange rate before and after the exchange reform.The data of CNY,CNH and NDF before and after the exchange reform were selected,and the ADF unit root test,cointegration test and Granger causality test were used.Analyze the balance and guiding relationship between them,and then establish a VAR model to analyze the size of the guiding force between them.Before and after the implementation of the “8·11” exchange rate reform,the issue of the pricing power of the RMB exchange rate between the two markets.The conclusion shows that before and after the middle price reform,the onshore market has the pricing power of RMB.Before the exchange reform,the onshore market had a strong guiding force for the offshore market.After the exchange reform,the marketization degree of the middle price increased.The central bank took some measures to prevent the pricing power from falling to the offshore market and affected the stability of the RMB exchange rate.Interventions retain the pricing power of the renminbi,but this also affects the process of internationalization of the renminbi.In view of the development status of the RMB market,this paper puts forward some suggestions for promoting the comprehensive,balanced and healthy development of China’s foreign exchange market,making China’s RMB internationalization process more stable.