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Exchange rate policy

2023/2/24 19:33:21  Classification:   Participation: 8  

Exchange best forex rebate bestforexrebate (Exchangeratepolicy)Th rebatemean cashback forexginforex entry corresponds to the page classification is rebateinforextrading rate policyExchange rate policy Overview Exchange rate policy refers to a countrys government to use the rise rebatesinforex fall of the exchange rate of its currency to control imports and exports and capital flows in order to achieve the balance of payments of the purpose of international coordination of exchange rate policy can be through international financing cooperation, joint intervention in the foreign exchange market and macroeconomic policy coordination. As one of the macroeconomic policies of a country, exchange rate policy always has certain operational rules for policy objectives. In practice, the objective of a countrys exchange rate system is often constrained by many factors and may be adjusted according to the actual situation, but in any case, at a certain stage, the objective of a countrys exchange rate system will always be relatively fixed exchange rate policy objectives 1. The main thing is the choice of exchange rate regime, which refers to a series of arrangements and regulations made by a countrys government on issues such as the determination of the level of the exchange rate of its currency, the way the exchange rate moves, etc. According to economic structural determinism, the choice of an exchange rate regime for a country should be considered in the light of the structural characteristics of the countrys economy. size, degree of economic openness, degree of international financial integration, inflation rate relative to the world average, and trade pattern Poirson (2001) proposes a system of indicators to measure the flexibility of exchange rate regimes using a sample of 93 countries during 1990-1998 and states that the main determinants affecting the choice of exchange rate regime are. Inflation rate, level of foreign exchange reserves, production and product diversification, vulnerability to trade shocks, political stability, size of the economy or GDP, capital flows, unemployment rate or inflation triggers, and foreign currency fixed debt Exchange rate regimes have traditionally been divided into two categories according to the magnitude of exchange rate movements, fixed exchange rate regimes and floating exchange rate regimes After floating exchange rate regimes replaced fixed exchange rate regimes, countries original prescribed currency legal After the floating exchange rate system replaced the fixed exchange rate system, the original legal content of the currency of each country or with other countries to conclude the gold parity of paper currency, it does not play any role, therefore, the national exchange rate system tends to be complex, market-oriented With the continuous reform of the global international monetary system, the International Monetary Fund in April 1, 1978 to amend the "International Monetary Fund" provisions and formally effective, the implementation of the so-called "As the new exchange rate agreement gives countries a strong degree of freedom in the choice of exchange rate system, countries now have a variety of exchange rate systems, including individual floating, pegged floating, flexible floating, joint floating, etc. 2. The change and adjustment of the exchange rate level The change of the exchange rate level must be organically linked with the formation of the exchange rate mechanism, if the exchange rate level is moved without moving the mechanism, it is difficult for the exchange rate level to function effectively but the reform of the exchange rate mechanism must be carried out in a relatively stable and healthy state of the economy Chinas RMB exchange rate policy China is currently implementing a market-based, single, with Maintaining the basic stability of the RMB exchange rate at a reasonable and balanced level Over the past 10 years, the basic stability of the RMB exchange rate has promoted Chinas economic development and reform and opening up, while also contributing to the maintenance of financial and economic stability in Asia and the world The stable development of Chinas economy and finance will provide a larger market and more investment opportunities for the neighboring regions and countries around the world, and will contribute to the global economy. It has been proven that maintaining the basic stability of the RMB exchange rate at a reasonable and balanced level is conducive to both the stability and development of Chinas economy and the stability and development of the Asian region and the world economy 2. Maintain the basic stability of the RMB exchange rate at a reasonable and balanced level, further explore and improve the RMB exchange rate formation mechanism in deepening financial reform, play the basic role of market allocation of resources, enhance the role of exchange rate leverage in regulating the economy, and promote balance of payments and slight savings Further improvement of the RMB exchange rate formation mechanism should fully consider the following factors: 1. Trade liberalization is more fully operated, and service The reform of Chinese state-owned commercial banks has taken significant steps, and the competitiveness and risk resistance of state-owned commercial banks have been significantly improved. Our policy is to make full use of both domestic and international markets and two kinds of resources to achieve a basic balance of payments with slight savings. The adjustment of the RMB exchange rate is a structural adjustment, which is in line with Chinas own interests. From an economic point of view, the focus of the policy change is to adjust the formation mechanism of the RMB exchange rate, not the RMB exchange rate itself, which is not suitable for Chinas economy to be pegged to a fixed exchange rate. On the one hand, it hinders Chinas own monetary policy and causes resource mismatch, and on the other hand, it is not conducive to Chinas internationalization process and economic restructuring. However, the trend of hot money inflow has slowed down significantly, and when it slows down further, it is time for the RMB to adjust.

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