The influence of the international currency of macroeconomic

Abstract：Under the current trend of economic globalization background， Chinese economy gets a very big development， RMB appreciation and more international issues come .This requires us to explore the impact of future RMB internationalization of China， including monetary policy， exchange rate policy， macroeconomic caused for all aspects of money supply and demand determine the exchange rate and fiscal balance equation.This article lists the benefits of RMB internationalization of Chinese economy into discusses the specific influence of the international currency for Chinese macro-produce， and proposes several strategies to further the use of RMB internationalization development of Chinese macro economy.

Key words：International currency；Macroeconomic

International currency mainly refers to a country's currency breake the boundaries of the country and circulate abroad， thus becoming the world's universal process for accreditation valuation， settlement and reserve currency. As a result， the currency is known as the International Monetary namely. In the past， British pound， US dollar， yen and euro in international currency have started the development process， which has become one among the global monetary system is now extremely important international currency. With the current renminbi to be very widespread in our country and neighboring countries which use the border trade with RMB-denominated financial assets in global financial markets also continued to emerge among， China's renminbi currency has been toward the internationalization of the direction of continuous development. Especially after sweeping the world a few years ago the world financial crisis， China and the large number of countries signed a reciprocal currency swap agreement terms， and has launched a pilot mechanism for the implementation of cross-border RMB settlement of trade， which indicates that China's yuan internationalization process with substantial changes. International currency mainly refers to a country's currency broke through the boundaries of the country and to circulate abroad， thus becoming the world's universal process for accreditation valuation， settlement and reserve currency. As a result， the currency is known as the International Monetary namely. In the past， British pound， US dollar， yen and euro in international currency has started the development process， which has become one among the global monetary system is now extremely important international currency. With the current renminbi to be very widespread in our country and neighboring countries which use the border trade with RMB-denominated financial assets in global financial markets also continued to emerge among， China's renminbi currency has been toward the internationalization of the direction of continuous development. Especially after sweeping the world a few years ago the world financial crisis， China and the large number of countries signed a reciprocal currency swap agreement terms， and has launched a pilot mechanism for the implementation of cross-border RMB settlement of trade， which indicates that China's yuan internationalization process with substantial changes. However， and the dollar， the yen and the euro and other international currencies compared to the current status of the RMB position among the country's monetary system and China's second largest economy in the world there are still large gaps in the yuan's current world financial system also there is no right to speak， causing our domestic macroeconomic policies tend to be subject to others. In view of this， China's macroeconomic research community and practitioners to further increase the pace of yuan internationalization expectations very high. However， people rarely care about after the internationalization of the RMB for all types of macroeconomic impact caused by the impact or little known about. Here， the author tries to explore the impact on the international currency of macroeconomic， in order to provide reference for Macroeconomic Research of RMB internationalization later.

1. The Benefits Economy Of Chinese RMB Internationalization

RMB internationalization can not only promote China's integration into the global economic globalization to promote the globalization of finance， but also can help improve our global economic exchange among the acquired interests， as well as help improve our global status， and it can help reduce the level of the international monetary dependence possessed， and when the national currency and the internationalization of the future， their own functional currency will be new changes.

Before the RMB internationalization， the RMB in micro-economic activities usually have the following four functions： First， as a means of circulation or an important trading medium. China and other economies with each other commodity and service transactions such activities can be said to be the most common type of economic activity， while the yuan is the main tool of the economic activity is completed. Because the money in the commodity trading process mainly from the role of the media， enabling a smooth transition or the flow of commodities between China and other countries. Second， become a standard of value or unit of economic trade. Related economic activities in class and borrowing transactions， are difficult to leave for the subject matter and the measurement value is calculated on. The main representative of a certain monetary value of the unit， by virtue of which measure the level of all other goods， services， assets and liabilities of the magnitude of value， so that all kinds of objects of value to each other can be relatively quick. Third， as a means of storing value. Money is a typical representative of the general purchasing power， mainly through its postponement for the exchange of specific goods and services of the time， thereby saving enough for the future value or wealth. Fourth， an important standard means of payment or moratorium. RMB has not only among today's commodity trading role of the media， and will be used for all signed long-term trading agreements， so that agreement can fulfill a unified fixed standard.

When RMB realized its international currency after the global economic and trade exchanges in the process， the currency has the functional characteristics whitch determine the main economic exchanges in the international arena， particularly in international economic and trade activities， were unable to leave the money separate existence. RMB to play a functional role in the global role played by the country out of its very different， which features can be expressed as the following three aspects： First， the value scale to become more complicated. In the course of conducting international trade among the prices of goods and services mainly through the exchange rate of RMB and other currencies and so two different currencies， the exchange rate is to be reflected in the roundabout. Second， the means of payment function enough in the balance of payments equilibrium among the international community. Once the political， economic and cultural and other exchanges between national and occurred after the activity will cause the currency to pay each other， in the implementation of the corresponding owed， calculated the difference between the final still to be generated by the payment country payment， which is the daily business activities of domestic payment is still a considerable difference. Third， after the functions of means of circulation usually only appear in the damaging effects on international relations generally will play a role. This means the flow of domestic and functions vary. Means of circulation of international economic and trade activities among not only belong to the medium of exchange， but also new commodities and other commodity currencies peer exchange. Storage way international currency or precious metal is certainly capable of long-term stability and international credibility of the common currency higher category. Under certain conditions， these currencies can be used as a form of social wealth among， from one country to another.

2. The Specific Influence Of theInternational Currency For Our Country's Macroeconomy

（1） The Influence on Chinese monetary policy

After international currency，for the purposes of money demand equation， demand for the currency has no longer just a simple domestic demand is very economical level. After the realization of the international currency， it will become the world production， management， distribution and very important tool or means of calculation， all around the world there is a need for the money. As a result， the country issuing such currency， if you want to figure out the kind of money has the demand， we have to study in other countries and business people of the country for the currency of the actual demand. By the formula Mdf=g（r，（Eef-e）/ e，η）·η=f（se，Gf，MD） we can be inferred， once the currency of a country to achieve the international later， residents of other countries entirely may hold currency of the country， and all kinds of factors that influence the currency held by foreign citizens among， r is certainly the most important factors. In the past， relatively simple no Keynesian model among international currencies， L = ky-hr， where L is the demand for money， and y is income， r is the interest rate. Thus， r and L has an inverse relationship. Now， in the currency of a country to achieve future international， because r is the rate of return of the currency. Therefore， when the decline in r， that is， yields have fallen， so the actual number of the country to hold foreign currency will be due to the cost - benefit theory of the role of causing the overall number is reduced， the reduction means the most likely is free to sell or exchange with another embodiment of the international monetary and circulation. Because the currency has international relations， can be found in many foreign markets， among them the national currency， so that r and M each other is no longer a negative correlation， but become a positive relationship， so that it will enhance the currency may It is replaced by the risks.

（2） The Influence on Chinese exchange rate policy

From the formula Mdf = g （r， （Eef-e） / e， η） · η we can find that Md usually depends on r， is the rate of return or interest rate currency， as well as for goods from the formula Mdf = g （r ， （Eef-e） / e， η） · η can be found， Md usually depends on r， is the rate of return or interest rate currency， as well as expectations of monetary and currency made its international status has. Once foreign companies or people are expected to the country's currency will depreciate， when e is likely to rise， the often will choose a large scale in freely convertible currencies of other countries are more firm. Similarly， once foreign companies or people are expected to be the country's currency， which is likely to fall when e， the people holding the currency will select large-scale holdings of the currency， which means that a country currency devaluation acts occur and its currency policy is bound to affect the country's currency internationalization process. That this country is not able to implement the exchange rate depreciate it？ I think as long as a set off the assembly line can be done. That is the time when the exchange rate is calculated e raised to what extent it is possible to maintain the amount of foreign currency held by residents or businesses. Under the currency freely convertible and can be done in the domestic and foreign market integration in this situation often appear the phenomenon of currency substitution， that is， if someone expects when the exchange rate of a currency will be raised to， we will choose to use the upward trend of the currency with the pressure to replace the currency of another country holding the hands of its original， this result is certainly cause the currency exchange rate has improved.In view of the lifting of the commodity currencies would lead the country into the global market competitiveness decreased， the government of this country will certainly throw the national currency and the purchase currency of another country in order to prevent their currencies rise implementation. As a result， money supply growth will naturally exceed the Government's stated development objectives， that is， currency substitution will cause a country's currency is no longer able to maintain stable demand function. Thus， if the study based on monetarist ideas， able to maintain a relatively stable money supply added value of the monetary policy must be related to the use of compensatory money supply adjusted to offset the effects of changes in money demand caused by the. In fact， under the extremely well-developed financial and economic situation of a country's central bank imposed the compensatory monetary supply-side policy often will face great difficulty. This is because the central bank of a country can not accurately know the demand for money when it will appear to move， but also more unpredictable and in what extent the move. To sum up， the money supply is currency substitution caused by the reduction in size is extremely difficult to be precise estimate， which is a country's central bank on how to accurately measure out the supply of the national currency， how to accurately grasp the implementation of various types of policy instruments the intensity of regulation， more standardized definition of how monetary policy caused great difficulty.

3. Some strategies of developping Chinese macro-economy throughthe use of RMB internationalization development

（1） we must deal with all kinds of problems from RMB appreciation.

In promoting the process of internationalization of the currency， whether short-term or long-term behavior， both will make the country's currency is under the state continues to appreciate， especially for those in a period of rapid economic development in emerging-market countries， currencies upward pressure becomes more big， and often with the continued promotion of national self-confidence and the situation appears blind rising. However， too fast， and the expected appreciation， often it causes great harm， specific performance situation for domestic exports frustration， asset prices a bubble tendency， while the country's currency has become a global speculative financial capital pursued important objects， and finally it will result in financial instability and economic recession. For example， the yen appeared in its internationalization process among a substantial appreciation of its currency from the dollar in February 1985 when the exchange 260 yen to 80 yen high of April 1995 when such a It gave rise to very serious syndrome currency appreciation and the appreciation of the yen caused the last recession. Today， China's foreign exchange reserves have been ranked first in the world， a huge amount of foreign exchange reserves caused the monetary base is usually served in both passive state， such an action would cause the renminbi appreciation trend of long existence. In this context， once forced to start the process of internationalization of the yuan， it may lead to appreciation of the renminbi becomes more significant， so that it is not conducive to China's domestic financial markets remain stable and steady economic development.

（2） we should actively avoid trade surplus situation continues for a long time.

The essence of the present international monetary currency come across its borders， and thus held by non-residents were outside the circulation and use. The output of the currency fully use the following measures， which is the international trade and foreign investment. Based on the output of the national currency to international trade， which often requires frequent project can continue to maintain the deficit， that is， imports exceeded exports. The dollar has been able to achieve international， one of the successful experience of its very important that the policy of excessive consumption ahead of the United States has been advocating the implementation of， and rely on strength of its position in international trade has the process， you can use the current account deficit exporters continued to transport US currency， so that the US can very quickly in the world among people of the possession， use and circulation. It is clear that， once the international trade surplus trend can be maintained， it is difficult to use the currency of international trade channels for output. Today， Chinese consumption rate is generally relatively low， spending a long time， especially in the realization of the international currency may cause reduced， thereby increasing the overall size is not conducive to imports. All along， China's various types of current account surplus tends to have maintained momentum， once the domestic consumption， especially after long-term consumption shrinking imports， the trade surplus situation will be more difficult to obtain a change in a short time among the natural way RMB is not conducive to the external output.

（3） we should effectively prevent the country's domestic economy come into a state of recession.

After currency internationalization process implemented over time will cause great economic recession. Traced cross-border investment is mainly caused by a lot of domestic funds continued to flight， so that domestic investment continues to shrink. Since the eighties of the twentieth century， the Japanese government will spare no effort to promote the process of internationalization of the yen， It is in appreciation of the yen in the background， a large number of major Japanese companies to move overseas investment， such an action would cause Japan's hollowing out of domestic industries constantly， coupled with domestic economic restructuring in Japan have not been able to follow up in a timely manner， so that the Japanese economy has lost decade. Today， China's labor-intensive industries to promote economic development is often a very important force. Because in recent years China's labor costs continue to increase， especially in the coastal areas of labor shortage phenomenon emerged， leading to the international competitiveness of labor-intensive industries has constantly lost. It is precisely because of the implementation of the RMB internationalization， so that on the right of use of national domestic enterprises to allocate resources create a more favorable conditions， thereby enhancing our many domestic enterprises to carry out cross-border investments abroad， which led to a large number of inadequate domestic investment . Once our industry have not been able to achieve a timely transition， and our domestic economy will fall back into the international mistakes being.

（4） we must be highly vigilant of the risk of domestic inflation continues to deepen.

Improve the welfare of a country usually rely on seigniorage benefits generated. Mint sources of revenue from in many ways， but in the final analysis， or the use of large-scale issuance of banknotes to foreign countries export their way currency. Behind this seigniorage also has many potential risk of inflation. First， heavily influenced by foreign masses preferences. Foreign demand for the national currency is very difficult to predict， and the money multiplier is more complex， so that will cause our domestic money supply can not be achieved precisely controlled， it may lead to the spread of domestic liquidity . Also， because the height of the trend of world financial markets open， and if the national currency for international investors appeared very pessimistic expectations the yuan will quickly put all of their holdings quickly converted into other currencies， so that it will cause international currency reversal， thus causing widespread devaluation of the national currency， so a lot of money flows back to their country. These factors will lead to an important incentive for our domestic inflation. Today， China's inflation is always located on a relatively high level， and now has become an important factor in economic stability is not enough. Against this background， once greatly promote the process of internationalization of the RMB， it is entirely possible cause inflation problems gradually get worse， the situation is more difficult to clean up. In view of this， in promoting the process of internationalization of the RMB being， it should be strictly prevented because the international monetary situation and may result in the risk of inflation rising.

4. Conclusion

All in all， China promoting the RMB internationalization process among the country's monetary policy and fiscal policy under consideration is no longer just their specific national conditions， but should be fully taken into account in the international currency trading and run into for the corresponding impact on the monetary policy and fiscal policy of the country has developed. In the process of the development of the exchange rate should also take into account the development of the exchange rate over time and scope of the lower and its implementation. Monetary policy， when the Renminbi internationalization later， will correspondingly reduce the effects of their specific monetary policy， so we set goals at the time of a specific macroeconomic development， consideration should be given to monetary and fiscal policy implementation issues， so that it can better achieve the macro-economic development goals.