The Effect of RMB Exchange Rate on Trade Balance in Different Industries in China

Traditional balance-of-payments theory holds that a country's currency exchange rate changes will affect the size of the import and export and trade balance.Taking into account the different needs of industrial products,flexibility and competitiveness of our trade differences,as well as the changing of China's trade structure.This essay selects different types of industries in China for empirical test,and analysis comprehensively of the real exchange rate fluctuations in the RMB on China's balance of trade impact of the difference.The results show that the impact of China's foreign trade factors,the real exchange rate flexibility should be less than the income elasticity.There is a big difference in the impact of the RMB real effective exchange rate movements on trade balance of different industries.