The study looks at how different economic factors affect the exchange rate in China. They found that high volatility in the exchange rate can be risky, with prices changing a lot in a short time. China's currency, the yuan, is linked to the US dollar, which is influenced by China's exports to the US. The study focused on indicators like interest rates, inflation, exports, GDP, and external debt to see how they impact exchange rates in China. The research used data from 1987 to 2017 and found that individual investors new to the market contribute to the high volatility in China's exchange rate.