ON EXCHANGE RATE THEORY AND EXCHANGE RATE POLICY
Xianping Cheng
Abstract
Xianping Cheng
Abstract
Exchange rate is determined and affected by demand and supply in foreign exchange market,current account balance,monetary policy,prices of related assets,economic base,national income,and international balance of payment,etc.In order to improve the RMB exchange rate mechanism,we should change focus from the foreign exchange market to coordinating the policy of RMB and foreign exchange,from relating to foreign economy to coordinating domestic and foreign economy.Meanwhile,we have to supervise and forecast the trend of prime currencies and international money systems.
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Exchange rate is determined and affected by demand and supply in foreign exchange market,current account balance,monetary policy,prices of related assets,economic base,national income,and international balance of payment,etc.In order to improve the RMB exchange rate mechanism,we should change focus from the foreign exchange market to coordinating the policy of RMB and foreign exchange,from relating to foreign economy to coordinating domestic and foreign economy.Meanwhile,we have to supervise and forecast the trend of prime currencies and international money systems.
Key concepts: Balance of payments, Renminbi, Exchange rate, Economics, Foreign exchange market, Monetary economics, Order (exchange), Balance (ability)