CIAO DATE: 04/2015
February 2015
Centre for International Governance Innovation
Since China's pilot scheme for RMB cross-border settlement was launched in 2009, it has become increasingly important for monetary authorities in terms of macroeconomic policy frameworks. The authors use an analytical model that includes monetary supply and demand to examine the influences of RMB cross-border settlement on China's domestic interest rate, asset price and foreign exchange reserves. They also look at how RMB settlement behaves in different ways with the various items in China's balance of payments.
Resource link: The Influence of RMB Internationalization on the Chinese Economy: Theory and Policy [PDF] - 455K