| Summary: | 碩士 === 國立高雄第一科技大學 === 金融研究所 === 101 === The US dollar has been an international currency, but this trend has been changed lately. Expecting quantitative easing to be on the wane, investors must pay attention to the effect of foreign exchange rate on the portfolio. China’s Renminbi is now one of the foci of the market. As China plays a bigger role in global trade, the world will watch closely China’s Renminbi exchange rate policy. Under the influence of US dollar and Renminbi coupled with the international finance and domestic politics, the policy of the exchange rate of the New Taiwan dollar needs to be revised. This paper explores such issues and the challenges of the international finance to Taiwan.
The results show that in general statistical description, the unit root test and the EGARCH test, the China’s Yuan, in comparison with New Taiwan Dollar, has been more closely related to US Dollar. Granger Causality Test results show that the New Taiwan Dollar’s volatility is determined by the volatility of China’s Renminbi. Therefore, China’s Renminbi is more closely related to the US Dollar rather than the New Taiwan Dollar and such, China’s currency is more closely related to the world’s exchange rate.
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