This study is designed to investigate the impact of China exchange rate policy on its trading partners by using a country multi-dataset GVAR model. Our model includes samples of 30 countries, six from high-income, six from middle-income and eighteen from low-income countries. This study used annual time series data over the period 1992 to 2017. We constructed currency misalignment index and it provided some interesting features about the currency undervaluation and overvaluation. The results of the currency misalignment shows that China’s Renminbi is structurally more undervalued over the sample period as compared to other countries, and fluctuation in major currencies effects the global trade around the world. The overall empirical results of the GVAR model indicate that RMB undervaluation affects the trade pattern and macroeconomic performance of China’s trading partners. Overall, China’s exchange rate undervaluation has mixed effects on trading partner’s GDP, exports and imports. The devaluation of China’s RMB efficiently stimulated China’s exports and reduced imports. While, in some countries, this effect is reverse, the RMB undervaluation increases the GDP of partner countries and also increases their exports to China. The results confirm the strong and leading role of the Chinese Renminbi in the global trade.

Purpose - The adjustment of one country's monetary policy can cause the macroeconomic change of other countries. Due to this, this paper attempts to analyze the impact of China’s monetary policy on South Korea’s exchange rate. Research design, data, and methodology - Based on the flexible-price monetary model, sets of annual time series from 1980 to 2017 are employed to perform an empirical estimation. The vector error correction model is also used to exploit the short-run relationship between both of them. Of course, the South Korea’s real GDP, the China’s real GDP, South Korea’s interest rate, the South Korea’s interest rate and the South Korea’s monetary supply are treated as independent variables in this paper. Result - The long-run findings reveal that the China’s money supply has a negative effect on South Korea’s exchange rate. Respectively, the short-run findings depicts that the China’s money supply has negative a effect on South Korea’s exchange rate. Of course, other variables selected in this paper also have an effect on South Korea’s exchange rate whatever positive or negative. Conclusions - As the empirical evidence shows, the China’s monetary policy has a negative effect on South Korea’s exchange rate whenever in the long run or in the short run.

Purpose – The purpose of this paper was to analyze the Chinese government’s announcement of the RMB’s appreciation on July 1, 2010, and its aim was to ascertain whether the appreciation has affected Chinese export prices by empirically measuring the degree of the exchange rate pass-tough on those prices. Research design, data, and methodology - Using 73 HS trade categories with cross-industry and time-series data, the panel estimation of a fixed-effects model has been applied to measure the degree and stability of any exchange rate pass-through effects. The estimation results show that the export prices of most trade categories were affected by the exchange rate changes. The pass-through effect was generally small, at about –0.485, and statistically significant in most export prices. Results - The empirical results indicate that China would lose its advantage and competitiveness in export if the RMB were appreciated continuously and rapidly because its export goods would no longer operate under strong monopolistic competition. Conclusions – The implications for China’s exchange rate policy suggest that it would be better for the RMB to appreciate slowly and gradually rather than radically. It is clear that it would be allow the capital free flow in Chinese overall economic interest to reduce the continuous appreciation pressure on the currency and pave the way for improvements in export distribution competitiveness.