The Impact of RMB Exchange Rate Changes on the Import and Export Trade of China’s Textile and Clothing Industry: An Empirical Analysis Based on the Data from 2000 to 2019

Abstract

With the low-cost advantage of the textile and clothing industry gradually weakened, the impact of RMB exchange rate changes on the import and export of China's textile and clothing industry has become increasingly significant. In this paper, we use cointegration method to analyze the impact of RMB exchange rate changes on the import and export of China's textile and clothing industry. The results show that there is a significant positive correlation between the real effective exchange rate and import and export, and the real effective exchange rate has a greater impact on the export. In addition, there is also a mutually reinforcing relationship between imports and exports.