quora

The Effect Of RMB Revalue To The Economy Of China - Dissertation Example

Comments (1) Cite this document
Summary
The research study will take into consideration the revaluation of RMB and the effect it had on the economy of China. The revaluation of RMB has been in the limelight in the recent discussions on political and economic affairs. …
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER93.4% of users find it useful
The Effect Of RMB Revalue To The Economy Of China
Read TextPreview

Extract of sample
"The Effect Of RMB Revalue To The Economy Of China"

Download file to see previous pages The expectation on appreciation of RMB was postponed during the global financial crisis. The appreciation of RMB will affect the aggregate demand through two canals. The appreciation will cause pressure on the supply of money. This will lead monetary expansion in cases where sterilized intervention is not sufficient. The aggregate demand and prices of the assets will get stimulated. The imbalances between demand and supply will increase because of the expectations associated with trade surplus and speculative inflows of capital. The monetary authorities will buy the excess supply of foreign exchange in the market in order to maintain stability in exchange rates. The growth in assets of foreign currency was much more than the growth of base money. The growth of foreign assets even crossed the rate of growth of broad money. This puts pressure on the monetary authorities to fasten down the monetary growth. The growth of money will be out of control if measures of sterilized intervention cannot keep up to the task. The growth of assets of foreign currency has dropped below the growth rate of broad money after the financial crisis. In the long run, the growth rate of broad money will settle in the usual level and short term capital will start to enter into the economy of China and this will again put the supply of money under pressure. But even if the monetary authorities are able to control the stable growth rate of money supply, then also the expectation for appreciation of RMB will stimulate the aggregate demand and prices of the assets will rise. Once the appreciation of RMB is expected, the expected returns on the assets that are risky will increase and price of these assets will take the steep rising path. The value of the collateral will...
The politicians of U.S. are of the opinion that revaluation of the RMB will act as the solution in problems of trade deficit. But the reality is that the current trade deficit that U.S. has with China is mainly because of the prevailing economic conditions in U.S. So the trade deficit that is affected by RMB is negligible (Hong Kong Industrialist, 2005/6, p. 15). Introduction The director of Peterson Institute for International Economics blamed the undervaluation of the currency of China for job losses in the country of United States. The director also drew a plan of action if China did not withdraw the control of currency and permit the renminbi (RMB) to gain strength. The central bank of China known as the People’s Bank of China allowed for some relaxation. The bank announced that will abandon the two year old peg. The peg has kept the RMB with the dollar (Yu, 2010, p. 2). It allowed RMB to respond according to the forces of the market. China will now begin to move into the regime of floating exchange rate. The regime will be a tight one which was in practice in the period between 2005 and 2008. The value of RMB will be the base on a basket of currencies within a narrow range (Wharton University of Pennsylvania, 2010).
Method of Analysis
In the method of analysis the previous researches will be taken into account and stress will be given on assessing the impact of the revaluation on the economy. The different effects namely the balance sheet effect and the economic effect will be taken into consideration. ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“The Effect Of RMB Revalue To The Economy Of China Dissertation”, n.d.)
Retrieved from https://studentshare.org/biology/1397129-the-effect-of-rmb-revalue-to-the-economy-of-china
(The Effect Of RMB Revalue To The Economy Of China Dissertation)
https://studentshare.org/biology/1397129-the-effect-of-rmb-revalue-to-the-economy-of-china.
“The Effect Of RMB Revalue To The Economy Of China Dissertation”, n.d. https://studentshare.org/biology/1397129-the-effect-of-rmb-revalue-to-the-economy-of-china.
  • Cited: 0 times
Comments (1)
Click to create a comment or rate a document
br
brentcole added comment 5 months ago
Student rated this paper as
I never thought 2250 words essay could be written in such a free manner. I loved the content of this essay. Will definitely use it for my own work!
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
How do Small-Medium Private enterprises contribute to the local economy in China -- look at ZheJiang Provice
Abstract Purpose of the Study: In relation to the case of Zhejiang Province in China, this study aims to determine how private small-medium enterprises (SMEs) contribute to the short- and long-term development of its local economy. Research Hypotheses: H1: Private SMEs in Zhejiang Province has a direct positive impact on its economic development; and H2: Private SMEs in Zhejiang Province has a direct positive impact on its social development.
54 Pages(13500 words)Dissertation
The Effect of FDI on Employment and Economic Growth in China
The country earns the attraction of potential foreign investors owing to the incidence of cheap human resources with potential resource base. Foreign Direct Investment thereby gains an entry into the region mainly through the events like mergers and acquisitions or through the foreign trade earned from export activities.
18 Pages(4500 words)Dissertation
The strength of the economy of China and the future of the economy
The aim of the study is to analyze the economical condition of China, the developments made by the Chinese government, which made the country one of the most developed countries in the world. The researcher will also analyze that whether the future of the economy is also strong. To make the economy strong, the government has to make certain policies so that the base of the economy becomes strong.
6 Pages(1500 words)Dissertation
The Effect of interest rate Liberalization on the risk of commercial banks in China
China finally opted for interest rate liberalization in the year 2004, around thirty-six years after the reform process under Deng had started.
60 Pages(15000 words)Dissertation
The Effect of Article on the Economy Toulouse
Toulouse, the capital city of the region of Midi-Pyrénées in France, is situated on the Garonne River side, in a plain midway between the Atlantic sea and the Mediterranean Sea.
16 Pages(4000 words)Dissertation
The effect of the U.S. Subprime Crisis to the China commercial banks in 2008-2013
The effect of the U.S. Subprime Crisis to the China commercial banks in 2008-2013. The sub-prime mortgage crisis that originated in the United States of America basically started from August 2007 and had transformed the financial markets around the world.
42 Pages(10500 words)Dissertation
The effect of electricity supply on Nigeria economy in Oyo state

The researcher has developed following research objectives in order to narrow down the scope of this project: to study the level of electricity supply in the rural areas in Nigeria; to understand the extent to which commercial and industrial activities in these areas are dependent on electric power and to study how modern policy changes have affected power supply in the rural areas in the country.

20 Pages(5000 words)Dissertation
China
Globalization increased international trade across countries, increasing business opportunities and investments and contracting boundaries between nations across the world. However, it has also resulted in stiff competition among the business organizations and hence created barriers for the entrance of new potential business firms.
33 Pages(8250 words)Dissertation
The Effect of RMB Revaluation in the Economy of China
60 Pages(15000 words)Dissertation
Chinese Monetary and Exchange System Reform
The Sino economy has gathered further momentum. That was the reason that Chinese economy registered a real GDP growth of phenomenal 9.5 percent in 2004. China’s status of “world factory” is the result of that impressive growth show. The excellent performance of economy paved a way to massive capital inflows.
45 Pages(11250 words)Dissertation
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Dissertation on topic The Effect Of RMB Revalue To The Economy Of China for FREE!
logo footer
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • StudentShare App Store
  • StudentShare Google play
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us