The Impact of RMB Exchange Rate Fluctuation on China’s Export Commodity Structure

Abstract

This paper empirically investigates the RMB exchange rate volatility on the composition of China’s export commodities using data from 2002-2022. Real effective exchange rate of RMB, technological progress, trade openness and foreign direct head seeds are used as explanatory variables. Elevated real effective exchange rate of RMB and foreign direct investment are unfavorable to the upgrading in China’s export commodity composition; technological progress and increased trade openness are favorable to the structural upgrading of China’s export commodities. Finally, suggestions are made to improve the export trade structure further.