The paper gives the guideline, background and concrete path for comprehensive reform of RMB exchange rate regime, a systemic project that centers around the reform of RMB exchange rate formation mechanism under an improved foreign exchange market and foreign exchange administration system.

This paper explores the issue of RMB exchange rate formation mechanism.

Based on a review of the background of the establishment of China s interbank FX market,this paper introduces the development process of China s interbank FX market from the perspectives of reforming and improving the exchange rate forming mechanism,innovating products in the FX market and enhancing the level of service offered by CFETS.

The paper aims to understand the extent of RMB real exchange rate misadjustment through an empirical analysis of the influencing factors and at the same time points out the important impacts of exchange rate elasticity in the reform of RMB exchange rate policy and accordingly gives advice on the perfection of exchange rate forming mechanism.

RMB exchange rate formation mechanism reform is the focus of research scholars at home and abroad, China s economy is a hot issue on the formation mechanism of the RMB exchange rate reform is highly theoretical and practical significance.

Based on the current situation of China\'s capital controls,this article introduces exchange rate expectation in the trade balance model and does the empirical study for China.