The real exchange rate is a macroeconomic variable of a crucial importance, since it determines relative price of goods and services home and abroad, and influences economic agents’ decisions. The real exchange rate needs to be on the right level, as it can result in wrong signals and economic...

Any attempt to model monetary policy in China has to take into account two ‘specifics’ of the Chinese monetary policy: the reliance on several operational instruments, both quantitative (open market operations, discount rate, reserve requirement) and qualitative (selective credit allowances,...