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The emergence of the RMB: A "New Normal" for China's exchange rate system?

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  • Kunze, Frederik
  • Basse, Tobias
  • Wegener, Christoph
  • Spiwoks, Markus

Abstract

We investigate RMB pricing differentials for onshore and offshore trading. Testing for long memory, we find strong persistence in the pricing differential. Hence, the Chinese FX market in its bipolar structure still lacks basic conditions for perfectly integrated markets.

Suggested Citation

  • Kunze, Frederik & Basse, Tobias & Wegener, Christoph & Spiwoks, Markus, 2018. "The emergence of the RMB: A "New Normal" for China's exchange rate system?," Center for European, Governance and Economic Development Research Discussion Papers 348, University of Goettingen, Department of Economics.
  • Handle: RePEc:zbw:cegedp:348
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    References listed on IDEAS

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    More about this item

    Keywords

    CNY; CNH; RMB internationalization; Market integration; Emerging markets;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics

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