Examining the Chinese Exchange Rate Reform and the Possibility of the Chinese Yuan Becoming a Regional Trade Currency

Abstract

This paper analyzes the reasons and effects of the Chinese exchange rate reform (Yuan appreciation), explained and assess Hu Xiaolian’s (deputy governor of the People's Bank of China and the former director of the State Administration of Foreign Exchange in China) claims about the reform of China exchange rate system. The paper also explores the possibility of the Chinese Yuan becoming a regional trade currency. A summary with key point is also provided.