GTAP Resources: Resource Display
| GTAP Resource #287 |
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"The China Money Puzzle: Will Devaluation of the Yuan help or Hurt the Hong Kong Dollar?" by Wei, S, L Liu, Zhi Wang and W Woo Abstract A Chinese yuan devaluation could affect the stability of the Hong Kong dollar. This paper studies two linkages. The first, trade balance effect is studied through a CGE model. The result shows that the net change in Hong Kong's foreign reserve after a yuan devaluation is in fact negligible. The second, psychological effect is studied by a survey of financial market participants. In spite of the small trade balance effect, all respondents believe that a yuan devaluation would lead to a panic selling of Hong Kong assets. Therefore, a yuan devaluation is bad for Hong Kong dollar primarily through market psychology. |
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- Asia (East) |
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Public Access  GTAP Resource 287 (174.0 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 2:05:45 PM
