Study on the influence of Sino-US exchange rates on Chinese economy with a complex system approach

2022 Fiscal Year Annual Research Report

• Project/Area Number: 22F30729
• Allocation Type: Single-year Grants
• Research Institution: The University of Tokyo
• Principal Investigator: チン ユ 東京大学, 大学院新領域創成科学研究科, 教授 (00272394)
• Co-Investigator(Kenkyū-buntansha): JIANG WENHUA 東京大学, 新領域創成科学研究科, 外国人特別研究員
• Project Period (FY): 2022-07-27 – 2024-03-31
• Keywords: Foreign currency rate / Sino-US exchange rate / Japan-US exchange rate / Complex Systems

Outline of Annual Research Achievements

In the first year, progress has been made in predicting exchange rate trends and gaining insights into the Japanese Yen. Complex system approaches were employed, analyzing key factors, developing models, and comparing historical events. The research aims to provide academic guidance for sustainable exchange rates between China and Japan. Factors influencing the Sino-US exchange rate were identified, and preliminary conclusions were drawn. Collaborations with institutions such as Asahi News Agency, Toyota company, and Mitsui Sumitomo Bank enriched the research. The second year will focus on refining modeling, collaborating with the host institution and lab co-researchers. Visits to Japanese bank departments and interaction with researchers will foster communication and collaboration.

Current Status of Research Progress

2: Research has progressed on the whole more than it was originally planned.

Reason

In this first year, I have done my analysis using the comparative method. So far, I have completed the first part of my research and summarized all the factors that affect exchange rates. These factors, including "economic fundamentals," "deposit rate," "trade status," "investment liquidity," and "government policy," will be used in my future research. Since all of my research will be based on historical data and law, as well as literature survey, the current status and achievements of research have laid a solid foundation for progress in the next fiscal year.

Strategy for Future Research Activity

This year, my research will focus building an exchange rate model that incorporates complex systems thinking to analyze the influence of the Sino-US exchange rate on China's economy. I will try to integrate important factors into the model. At the same time, I will cooperate with Japanese financial institutions to gain insights. Rigorous backtesting and scenario testing will ensure the validity of the model. The validated model can serve as a strategic tool for Chinese policymakers, providing a deeper understanding of the implications of the exchange rate. Dissemination will take place through journal publications and conference presentations. In essence, this research aims to clarify the complex dynamics of the Sino-US exchange rate on China's economy through an integrated, tested model.