Monetary Policy, Investors’ Attention and the Dynamic Evolution of RMB Exchange Rate

DOI

10.2991/emle-18.2018.13How to use a DOI?

Keywords

RMB exchange rate; monetary policy; investors’ attention

Abstract

In recent years, the development of behavioral economics pointed out that the premise of investor behavior is investors' attention. Therefore, investor attention is an important channel through which monetary policy affects exchange rate. Consequently, it is necessary to study the relationship between monetary policy and exchange rate from the perspective of investors. This paper uses the Baidu index to construct the investor's attention index on monetary policy, and empirically analyzes the relationship between investors' attention and RMB exchange rate through the VAR model. The research results show that investors focusing on monetary policy can significantly positive influence on the RMB exchange rate changes, and the effect of investors' attention on exchange rate changes is independent of the control variables. By discussing monetary policy level of investor attention and associated characteristics of RMB exchange rate, this paper extends the research of investor attention on the foreign exchange market, provides reference for better implementation of monetary policy, and offers a new train of thought for exchange rate determination.

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Du Xiuli
AU  - Ye Zhenzhen
PY  - 2018/12
DA  - 2018/12
TI  - Monetary Policy, Investors’ Attention and the Dynamic Evolution of RMB Exchange Rate
BT  - Proceedings of the 4th International Conference on Economics, Management, Law and Education (EMLE 2018)
PB  - Atlantis Press
SP  - 69
EP  - 77
SN  - 2352-5428
UR  - https://doi.org/10.2991/emle-18.2018.13
DO  - 10.2991/emle-18.2018.13
ID  - Xiuli2018/12
ER  -