Macroeconomic Interdependence and Exchange Rate Policy in China: Time Series Evidence from China and the United States

China-bashing has become a popular US media and political sport. This is largely due to the US trade imbalance and the belief, by some, that China is responsible for it because it manipulates its currency to hold down the dollar prices of its goods, unfairly creating a trade advantage that has contributed to the loss of US businesses and jobs. This paper reviews the problem of the large trade imbalance that the United States has with China and its relationship to Chinese exchange rate policy. It examines the link between a Chinese renminbi appreciation and the trade balance and also whether a generalized dollar decline could solve the global or Chinese US trade imbalance. The consensus view explained here is that a renminbi appreciation is not likely to fix either the trade imbalance with China or overall. If these perceived benefits of a managed float are small or non-existent, then perhaps they should be pursued anyway because of small costs or even benefits for China. Section IV looks at the costs of a managed float in terms of the benefits of the earlier peg. Opponents of a fixed dollar/yuan exchange rate ignore the costs of a managed float for China, especially with limits on currency convertibility. These costs are outlined here in order to provide an economic basis for the earlier fixed rate and China’s reluctance to appreciate. Finally it is suggested that the necessary convertibility on capital account, toward which China is moving, could easily result in yuan depreciation under a floating rate regime. This is hardly the end that China critics have in mind and it is not one that would improve US or other trade imbalances with China.

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The United States: Silver Threats among the Gold, 1880–96

Currency Politics ◽

10.23943/princeton/9780691173849.003.0003 ◽

2016 ◽

Cited By ~ 1

Author(s):

Jeffry A. Frieden

Keyword(s):

United States ◽

Presidential Election ◽

Gold Standard ◽

The United States ◽

Political Conflict ◽

Exchange Rate Policy ◽

World Markets ◽

Rate Policy ◽

Currency Policy ◽

Almost All

This chapter surveys US currency policy in the 1890s. The United States was on the gold standard from 1879 until 1933. For almost all that time, US currency policy was politically controversial. The controversy became particularly heated during periods of economic distress, especially in the 1890s. In what is perhaps the most famous modern political conflict over exchange rate policy, the Populist movement launched a concerted attack on the gold standard, which led up to a presidential election fought largely over gold. The rise of the Populist movement came at a pivotal time as the country had matured industrially while remaining predominantly agrarian. The battle of the standards was also a fight over whose vision of society would dominate: the big cities with their booming finance, commerce, and industries, or the countryside with its thriving cotton, tobacco, and wheat farms whose products dominated world markets.

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Analysis of time series for Malaysian currency exchange rate to the United States currency

10.1063/5.0053700 ◽

2021 ◽

Author(s):

Ting Heng Sheng ◽

Mohd Saifullah Rusiman ◽

Norziha Che Him ◽

Suliadi Firdaus Sufahani ◽

Efendi Nasibov

Keyword(s):

United States ◽

Time Series ◽

Exchange Rate ◽

The United States ◽

Currency Exchange ◽

Currency Exchange Rate ◽

Analysis Of Time Series

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Exchange rate system, policy distortions, and the maintenance of trade dependence

International Organization ◽

10.1017/s002081830001907x ◽

1982 ◽

Vol 36 (4) ◽

pp. 715-739 ◽

Cited By ~ 3

Author(s):

Bruce E. Moon

Keyword(s):

Exchange Rate ◽

Developed Countries ◽

The United States ◽

Exchange Rate Policy ◽

Rate System ◽

Rate Policy ◽

Exchange Rate System ◽

The Exchange Rate ◽

Actual Exchange ◽

External Actors

Two central tenets of dependency theory are supported by the analysis of the causes and consequences of the exchange rate policies of less developed countries (LDCs). First, one critical component—high partner trade concentrations—is recreated by the choice of exchange arrangements. Specifically, nations that have maintained a dollar peg have significantly increased their concentration of trade with the United States since 1973. This occurs because of the exchange rate risk present in any transaction that involves a dollar-pegged currency and any other major currency against which it floats. Second, such an effect produces incentives for internal and external actors with an interest in the partner composition of future trade to influence the exchange rate policy of LDCs. Various components of the dependence situation that strengthen the role of such actors—partner trade concentrations, treaty arrangements, foreign aid, etc.—are significantly correlated with actual exchange rate practice. Thus, exchange rate policy is a linch-pin mechanism, in that it both manifests distortions produced by dependency and further acts to recreate a vital aspect of the situation that gave rise to the distortions.

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Exchange rates, Canadian lumber imports, and United States prices: a time-series analysis

Canadian Journal of Forest Research ◽

10.1139/x88-242 ◽

1988 ◽

Vol 18 (12) ◽

pp. 1587-1594 ◽

Cited By ~ 28

Author(s):

Joseph Buongiorno ◽

Jean-Paul Chavas ◽

Jussi Uusivuori

Keyword(s):

United States ◽

Time Series ◽

Exchange Rate ◽

Time Series Analysis ◽

The United States ◽

Monthly Data ◽

Softwood Lumber ◽

The Past ◽

Series Analysis

Softwood lumber imports by the United States from Canada more than doubled during the past 10 years. The objective of this paper was to investigate two possible reasons for this change: (i) the increase in value of the U.S. dollar relative to the Canadian dollar, and (ii) the rise in the price of softwood lumber in the United States. The method used was time-series analysis, leading to measures of feedback and long-term multipliers between imports, exchange rate, and U.S. price. The results, based on monthly data from January 1974 to January 1986, suggested that 68% of the rise in Canadian imports during this period was due to the rise in the price of softwood lumber in the United States. The exchange rate, however, was not found to have a significant effect on imports. The findings also indicate that the increase in imports has not led to a decline in the price received by U.S. producers.

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Faktor-Faktor Yang Mempengaruhi Nilai Tukar Dollar Amerika Serikat Terhadap Rupiah Tahun 2000–2013

Jurnal Riset Manajemen Sekolah Tinggi Ilmu Ekonomi Widya Wiwaha Program Magister Manajemen ◽

10.32477/jrm.v1i2.72 ◽

2017 ◽

Vol 1 (2) ◽

pp. 177-191

Author(s):

Rizki Rahma Kusumadewi ◽

Wahyu Widayat

Keyword(s):

Time Series ◽

Exchange Rate ◽

Money Supply ◽

Time Series Data ◽

The United States ◽

Economic Conditions ◽

Series Data ◽

Arch Model ◽

United States Dollar ◽

The Exchange Rate

Exchange rate is one tool to measure a country’s economic conditions. The growth of a stable currency value indicates that the country has a relatively good economic conditions or stable. This study has the purpose to analyze the factors that affect the exchange rate of the Indonesian Rupiah against the United States Dollar in the period of 2000-2013. The data used in this study is a secondary data which are time series data, made up of exports, imports, inflation, the BI rate, Gross Domestic Product (GDP), and the money supply (M1) in the quarter base, from first quarter on 2000 to fourth quarter on 2013. Regression model time series data used the ARCH-GARCH with ARCH model selection indicates that the variables that significantly influence the exchange rate are exports, inflation, the central bank rate and the money supply (M1). Whereas import and GDP did not give any influence.

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Fear of Free Floating or Forced Exchange Rate Fixing

Voprosy Ekonomiki ◽

10.32609/0042-8736-2004-6-112-122 ◽

2004 ◽

pp. 112-122

Author(s):

O. Osipova

Keyword(s):

Exchange Rate ◽

Financial Crisis ◽

Exchange Rates ◽

Inflation Targeting ◽

Exchange Rate Policy ◽

Float Exchange Rate ◽

Floating Exchange Rate ◽

Rate Policy ◽

Exchange Rate Arrangements ◽

Pass Through

After the financial crisis at the end of the 1990 s many countries rejected fixed exchange rate policy. However actually they failed to proceed to announced "independent float" exchange rate arrangement. This might be due to the "fear of floating" or an irreversible result of inflation targeting central bank policy. In the article advantages and drawbacks of fixed and floating exchange rate arrangements are systematized. Features of new returning to exchange rates stabilization and possible risks of such policy for Russia are considered. Special attention is paid to the issue of choice of a "target" currency composite which can minimize external inflation pass-through.

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