Monetary Policy And Structural Adjustment Of The Real Economy

After decades of rapid growth,China's economy has now moved to a stage of highquality development.In order to achieve a soft landing of economic transformation,we must implement supply-side structural reform,focus on improving the quality and efficiency of the supply-side system,and continue to reduce production capacity,inventory,leverage,reduce costs and make up for shortfalls,so as to reduce overcapacity and major risks,promote high-quality development and raise total factor productivity.In order to serve the real economy,prevent and control financial risks and deepen financial reform,we need to innovate and improve financial macro-control,maintain continuity and stability of policies,implement a prudent and neutral monetary policy,and create a neutral and appropriate monetary and financial environment for supply-side structural reform and high-quality development.To maintain a stable and neutral monetary policy,we need to strike a balance between stable growth,structural adjustment,deleveraging and risk prevention.At present,China mainly adopts open market operation and other liquidity.This is more expensive,shorter and more volatile than lowering the interest rate on Banks' reserves.On the one hand,we need to control the liquidity scale to help leverage and prevent financial risks.On the other hand,we need to take into account changes in the operation of the macro economy and make flexible use of various monetary policy tools to maintain reasonable and stable liquidity.We will promote structural optimization and support economic restructuring and transformation and upgrading.We will comprehensively improve the efficiency and level of financial services in the real economy,continue to optimize the orientation and structure of liquidity,and strengthen the guiding role of credit policies.We will provide financial services to promote transformation and upgrading of the manufacturing sector,transformation and adjustment of key industries and sectors such as infrastructure and railways.We will improve credit policy-oriented evaluation and guide financial institutions to increase credit support for weak links.This paper first measures the liquidity diversion mechanism in real economy and financial market,and its difference between different industries and different ownership,in order to judge the effectiveness and targeted effect of monetary policy on industrial restructuring,the liquidity diversion mechanism between the real economy and financial market,and the difference that it performs in different industries and ownerships,are all measured in this paper.It turns out that liquidity growth of financial market is four times as much as that in the real economy.Also,the liquidity allocation has no significant difference among different industries and ownerships.Moreover,the industries with overcapacity have stronger ability to absorb funds.So it can be concluded that the monetary transmission mechanism and financial market pricing can not automatically identify the backward production capacity.Therefore,when using monetary policy to guide industrial upgrading,not only the siphon effect of the financial market should be suppressed,but also the policy targeting should be strengthened in the area of the real economy.Then,this paper studies the role of monetary policy in corporate deleveraging from the perspective of interest rates,and also studies the impact of corporate leverage reduction on corporate performance.The study found that the leverage level of the company was significantly negatively correlated with the performance of the company.State-owned or state-controlled companies are over-leveraged,pushing up the leverage of all listed companies.The growth rate of leverage of private enterprises is higher than that of listed companies.The increase in leverage in real estate and construction is an important factor driving up overall corporate leverage.Monetary policy did not play the expected role in coordinating deleveraging policies.Therefore,in the process of "deleveraging",the company should open source and save the flow,the government should give tax incentives,develop and make large equity investment,and make monetary policy more targeted and effective.Finally,in order to measure the impact of de-capacity policy on industry performance,this paper focuses on the performance interrelationship of twelve sub-industries.We establish a VAR model,then with the method of variance analysis and social network,the performance conflicts among different industries are depicted.The result shows that the performance of each industry influences each other,and there is a symbiotic effect in the industry.It also can be concluded that the performance of culture communication industry suffers the biggest impact from other industries.Meanwhile,the performance of electricity,water and gas industry generates the biggest impact to other industries.Accordingly,we should make overall arrangements,adjust measures to local conditions instead of just taking one single industry into account,and introduce more scientific and reasonable policies when formulating policies of supply-side reform.