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Article: An empirical assessment on China's optimal foreign exchange reserve: 1985-2004.
- Article from:
- Journal of Asia Business Studies
- Article date:
- March 22, 2007
- Author:
CopyrightCOPYRIGHT 2007 University of San Francisco, School of Business and Management. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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ABSTRACT
This paper analysises China's optimal scale of foreign reserve during 1985-2004 with single ratio and synthesis ratio. The single ratio analysis shows that China's foreign reserve to import ratio has exceeded 40% after foreign exchange rate united in 1994. The foreign reserve to money supply ratio is high as 23.8%, and will exceed 25% of international alertness in 2005. The foreign reserve to debt ratio largely exceeded 30% of international alertness. The current account balance to GDP ratio and the current account balance plus FDI to GDP ratio is out of international alertness in most years. The synthesis ratio analysis show that China's real foreign ...