Download this Paper Open PDF in Browser

A Reinvestigation of the New RMB Exchange Rate Regime

19 Pages Posted: 9 Apr 2012  

Lei Tian

Zhongshan University

Date Written: April 9, 2012


In order to examine the new RMB exchange rate regime rigorously, we employ the STARTZ model to investigate the behavior of RMB NEER from mid-2006 to mid-2008. We find that a managed float with a target central parity and without an explicit band best describes the daily movement of the exchange rate between RMB and a basket of currencies. We also find some peculiar attributes of the RMB NEER such as small conditional variance and stronger effects of government interventions in foreign exchange market.

Keywords: BBC Rule, RMB NEER, STARTZ model, Target zone, a managed float

JEL Classification: C22, F31, F33

Suggested Citation

Tian, Lei mname, A Reinvestigation of the New RMB Exchange Rate Regime (April 9, 2012). Available at SSRN: or

Lei Tian (Contact Author)

Zhongshan University

135 Xin Gang Xi Road
Guangzhou, Guangdong Province

Paper statistics

Abstract Views