Research on the Interactive Relationship between China’s Foreign Exchange Reserves, CPI, Money Supply, and Foreign Investment Based on VAR Model
Cong Li1, Hongguo Sun2
1Cong Li, Department of Mathematics and Finance, Hunan University of Humanities Science and Technology, Loudi, China.
2Hongguo Sun, Department of Mathematics and Finance, Hunan University of Humanities Science and Technology, Loudi, China.
Manuscript received on June 01, 2018. | Revised Manuscript received on June 07, 2018. | Manuscript published on June 15, 2018. | PP: 1-4 | Volume-5, Issue-6, June 2018. | Retrieval Number: F1073065618
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© The Authors. Published By: Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Based on the study of foreign exchange reserves at home and abroad, this paper selects the monthly sample data of China’s foreign exchange reserves, CPI, money supply, and foreign investment from 2008/1- 2018/3 (data from the National Bureau of Statistics of China).In order to analyze the potential interaction between China’s foreign exchange reserves and CPI, money supply, and foreign investment, we try to use ADF unit root test, explore the co-integration relationship between data, and establish VAR models.
Keywords: Foreign Exchange Reserve, CPI, ADF Unit Root, VAR Model, Impulse Response Function.