OnJuly21,2005,thePeople'sBankofChinaannouncedanewreformplan,accordingtowhich,RMBwouldnolongerbepeggedtotheU.S.dollarbutwouldreformtheexchangerateregimebymovingintoamanagedfloatingexchangerateregimebasedonmarketsupplyanddemandwithreferencetoabasketofcurrencies.①ThereformisanimportantstepintheprocessofChina'sreformandopening-up.HenceithasspecialsignificanceforeconomicdevelopmentofChina.However,whatmeritsattentionisthatthepresentinternationalmonetaryregimeisunstable,financialsystemisveryfragileandbigpowershaveshownanunwillingnesstotakefinancialcooperation.②ThishasposedgreatchallengestotheprocessofRMBexchangeratereform.NowIwouldliketoexaminethepossiblerisksofthereformandthentrytomakesomesuggestionsthroughmakingsomeanalysisofthestatusquoofinternationalmonetaryandfinancialsystem.
