Research on the correlation between onshore and offshore RMB markets

Hong Kong as a center of renminbi offshore markets is developing rapidly in recent years, and the interaction between onshore and offshore markets has been more frequent. This paper selects Hong Kong as the representative of the RMB offshore markets to analyzes the general correlation between RMB onshore and offshore markets, and employed VAR model to understand the exchange rate correlation and found that, developments in the onshore spot market exert an influence on the offshore spot market. As a result of theoretical and empirical researches, put forward recommendations on expanding the positive effects of correlation to facilitate internationalization of RMB.