The Impact of China’s Epidemic Policy Liberalization on Exchange Rate

On December 7, 2022, the Chinese government announced full liberalization of the epidemic policy. Since the outbreak of COVID-19, China has implemented a” zero infection” policy for more than two years. The liberalization of the epidemic policy affects China’s economy and other aspects significantly. This paper selected the exchange rate of RMB against USD in China and intercepted its exchange rate data from January 2020 to the end of 2023. The ARIMA model was used to model and analyze the data, so as to study how the reopening policy impact on RMB exchange rate. This article finds that the reopening policy will increase the exchange rate of RMB in following period. Finally, some suggestions are put forward for the formulation of future policies. Article suggests policy maker identifying problems and modify policies in time to reduce the recognition and decision-making lag. At same time investors are advised to follow the exchange rate changes and increase foreign investment.