Influence of Hong Kong Offshore RMB Market on China's Foreign Exchange Reserves

Jia-Jia YAN, Cai-Ling CHEN, Le-Rong HE

Abstract


The paper utilizes monthly onshore RMB and the Hongkong offshore RMB data from May 2012 to January 2016 and applies the state space models to illustrate how the Hongkong offshore RMB market affects China’s foreign exchange reserves. The results confirm the impact of the offshore RMB market on Chinese foreign exchange reserves. Accordingly, the paper provides recommendations as well.

Keywords


Offshore Market, Foreign Exchange Reserves, Cross-Border Trade Settlement


DOI
10.12783/dtssehs/icesd2017/11643