Empirical Analysis of the Impact of Chinese Yuan to US Dollars Exchange Rate on the Shanghai Stock Exchange Composite Index

DOI

10.2991/978-94-6463-546-1_32How to use a DOI?

Keywords

Shanghai Stock Exchange Composite Index; Chinese Yuan to US Dollars Exchange Rate; Closing Price; Export and Import; Capital Flow

Abstract

This study extends from the findings of prior research on Exchange Rates and Stock Composite Exchange Indices and explores the influences of the Chinese Yuan Exchange Rate on the Shanghai Stock Exchange Composite Index based on contemporary data. The study uses the daily data of the Chinese Yuan Exchange Rate and the Shanghai Stock Exchange Composite Index from the Choice Database and utilizes the Vector Autoregression Model and the Impulse Response Function to analyze the impact of the Exchange Rate on the Composite Index with the aid of Stata. The primary focus of this study is to suggest a discernible ability of the Exchange Rate to explain the variations in the Composite Index and inspect for potential explicit explication. The purpose of this study is to use the findings in terms of the temporary and lasting effects of the Exchange Rate shocks on the Composite Index to support investors and policymakers in their decisions. The study also takes a different approach that aligns the interconnections between the Exchange Rate, imports and exports indices, GDP, and Composite Index that indirectly evaluate the relatedness between the first and last variables. This study finds that a change in the exchange rate likely causes a relatively positive shift in the composite index, proposing an increasing intensity of investment or a change in investment strategies and that policymakers should attempt methods that either stabilize the alterations to promote economic stability or activates oscillation to foster long-term growth.

Copyright

© 2024 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Yiping Wang
PY  - 2024
DA  - 2024/10/27
TI  - Empirical Analysis of the Impact of Chinese Yuan to US Dollars Exchange Rate on the Shanghai Stock Exchange Composite Index
BT  - Proceedings of the 2024 2nd International Conference on Finance, Trade and Business Management (FTBM 2024)
PB  - Atlantis Press
SP  - 288
EP  - 297
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-546-1_32
DO  - 10.2991/978-94-6463-546-1_32
ID  - Wang2024
ER  -