The Application of Grey System Theory to Exchange Rate Prediction in the Post-crisis Era
نویسندگان
چکیده
The international financial crisis has significantly affected every economy in the world. After the financial crisis, there are many factors together that aggravate the uncertainty of the Chinese exchange rate. A GM (1, 1) model is proposed for predicting short-term changes in the Chinese exchange rate. The Weakening Operator method is applied to improve the prediction accuracy. The results showed that the Grey System model has high accuracy in predicting the trends of change in the exchange rate with insufficient data. Based on the simulation results, the robustness of the model is supported. Additionally, the results also show that the Chinese exchange rate of RMB to USD is expected to appreciate.
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