Purchasing Power Parity and the Chinese Yuan
Results from unit root tests applied to the bilateral China - US real exchange rate do not support purchasing power parity between the two countries. However, tests of the real equivalent exchange rate for the Chinese yuan versus a traded-weighted basket of currencies support purchasing power parity. Due to severe non-normality, critical values for tests of the real equivalent exchange rate are obtained from the wild bootstrap.
Gregory, Richard Paul; and Shelley, Gary. 2011. Purchasing Power Parity and the Chinese Yuan. Economics Bulletin. Vol.31(2). 1247-1255.