Mr. Li Ruogu

Chairman and President of China Eximbank

27 March 2012

The Relationship Between Exchange Rates and International Trade

Outline

2

Complicated Relationship between Exchange Rates and Foreign Trade

Exchange Rates Levels and Trade Imbalances

Exchange Rate Volatility and Foreign Trade

The Causes of High Exchange Rate Volatility

3

　Nominal

Exchange Rate Volatility

Nominal Effective Exchange

Rate Volatility

Real Effective Exchange

Rate Volatility

Average Annual Growth

Rate of Exports

Average Annual Growth Rate of

Imports

1995-2011

Brazil 4.2 4.0 4.0 6.1 8.4

China 0.3 1.3 2.0 17.8 15.6

India 1.6 1.5 1.6 14.1 13.2

Russia 6.1 6.1 5.3 6.2 10.6

2005-2011

Brazil 3.7 3.2 3.1 3.7 14.5

China 0.4 1.3 1.9 15.6 11.9

India 2.0 1.6 1.7 13.1 15.7

Russia 2.8 2.1 4.1 3.8 12.4

Sources: IMF, BIS, World Bank WDI.

Exchange Rate Volatility and Trade Growth Rate (%)

4

Sources: Bloomberg1.Bilateral exchange rates against the U.S. dollar (increase denotes depreciation)

Exchange Rate Indices, Jan 2010=100

5

Sources: IMF WEO Database

G20: Savings and Current Account

2001-2010 Average

Thank you!