The Impact of Newly Permitted Domestic CNY Business in Taiwan on the NTD vs. CNY Exchange Rate

• Main Authors: WANG CHIA CHING, 王嘉慶
• Other Authors: LIEH-MING LUO
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/zy655g

碩士 === 輔仁大學 === 金融與國際企業學系金融碩士在職專班 === 102 === Taiwan is an island economy, highly dependent of international trade. So far, USA still served as the key liquidation currency for Taiwan. But now China has become the major partner of international trade for Taiwan, the newly-permitted domestic CNY Business in Taiwan will inevitably induce an influence on the NTD vs. CNY exchange rate. This study attempts to use Unit root test, Granger causality test, cointegration test and Vector error correction estimates, and time-series test method to examine the effects, after permitted domestic CNY business in Taiwan, it may have an impact on the factors that make an inquiry in NTD exchange rate.. Before newly-permitted domestic CNY Business in Taiwan, NTD and CNY does not have significant one-way Granger causality or mutual Granger causality, either cointegration relationship exists. However, after newly-permitted domestic CNY Business in Taiwan, the results showed that the CNY/USD exchange rate and NTD/USD had a one-way Granger causality and produce a negative long-term cointegration relationships, the newly permitted domestic CNY Business in Taiwan indeed and obviously affected the CNY exchange rate and NTD exchange rate causal relationship on either the Granger causality or cointegration relationships. In addition, according to Vector error correction estimates, after the newly-permitted domestic CNY Business in Taiwan, NTD/USD exchange rate’s changes do not affect the change in the CNY/USD, and when the CNY/USD and NTD/USD short-term trend deviation occurs when launched by the CNY/USD adjustment mechanism, but also shows changes in the CNY/USD would significantly affect the NTS/USD exchange rate.