| After the Second World War,in order to control the cost of economic financing and stimulate economic recovery and development,most developed countries began to control interest rates.However,with the changes of the external environment and the development of the times,the interest rate control policy has gradually shown negative effects,and the restriction on economic development has become increasingly prominent.After entering the 1970 s,financial regulation was more liberalized,which brought a global interest rate marketization wave.Interest rate marketization is an economic system in which market supply and demand determine the level of interest rate in economic activities,and market mechanism plays a decisive role in the allocation of funds.In 1993,the Fourteenth National Congress of the Communist Party of China passed The Decision on the Reform of the Financial System,which proposed that the long-term goal of the interest rate reform in China is to establish a market interest rate management system,which is based on the supply and demand of market funds,with the benchmark interest rate of the central bank as the control core,and with the supply and demand of market funds to determine various interest rate levels.In 2003,the report of the 16 th National Congress of the Communist Party of China put forward that we should steadily promote the reform of interest rate liberalization and optimize the allocation of financial resources.In 2013,The Decision on Several Major Issues of Comprehensively Deepening Reform adopted by the Third Plenary Session of the 18 th Central Committee of the Communist Party of China clearly proposed that "the market plays a decisive role in the allocation of resources to deepen the reform of economic system".As the price of money and funds,interest rate marketization reform aims to make the market play a decisive role in the allocation of funds.Since the end of last century,in the process of interest rate marketization reform,the People's Bank of China has unswervingly implemented the principle of "loan first,deposit second,foreign currency first,local currency first,long-term first,short-term second",promoted the gradual formation of interest rate marketization in bond and money market,and persisted in promoting the marketization of loan and deposit interest rates in a step-by-step manner.In January 1996,the People's Bank of China set up a unified interbank lending market and set up a Chinese Interbank Offered Rate(CHIBOR).Since June 1 of 1996,the central bank has deregulated the inter-bank lending rate.The level of interest rate is determined by the two sides through consultation,which marks a solid step forward in the marketization of interest rate.At the same time,the stock exchange market for the first time adopts the way of interest rate bidding to issue treasury bonds,realizing the marketization of the interest rate of treasury bond issuance.In June 1997,the central bank promoted the establishment of a national unified inter-bank bond market,and the national bonds held by deposit financial institutions were transferred to the inter-bank bond market for circulation.At the same time,the control of bond repo rate and bond transaction rate in the inter-bank bond market was released.In September 1998,China Development Bank issued financial bonds in the inter-bank bond market for the first time in the form of public bidding,which opened the prelude to the marketization of financial bond issuance.In October 1999,the Ministry of Finance issued bonds in the inter-bank bond market in the form of interest rate bidding for the first time,marking the basic realization of bond interest rate marketization in China.With the steady progress of interest rate marketization,the central bank actively promotes the transformation and improvement of monetary policy,so that the market has greater autonomy in interest rate pricing,and promotes it to play the role of optimizing the allocation of financial resources and regulating the macroeconomic operation.Since 1998,the control of credit scale has been cancelled.In the same year,the People's Bank of China has reformed the formation mechanism of discount interest rate,which has become an independent interest rate type and an independent monetary policy tool of the central bank.In 1998-1999,the People's Bank of China issued an announcement to expand the floating range of loan interest rates of financial institutions for three times in a row.In October 1999,the central bank approved Chinese commercial banks to pilot long-term large amount agreed deposit business with Chinese insurance institutions,and the deposit rate was determined by the commercial banks and insurance institutions through consultation.In September 2000,the central bank implemented the reform of foreign currency deposit and loan interest rate management system,and the commercial banks independently decided the foreign currency loan interest rate large amount foreign currency deposit interest rate.In March 2002,the central bank released the control of small foreign currency deposit rate of non residents.In July 2003,it released the management of small foreign currency deposit rate of British pound,Swiss franc and Canadian dollar.In November 2003,the central bank implemented the upper limit management of little amount foreign currency deposit rate of residents such as US dollar,Japanese yen,Hong Kong dollar and euro,and under the condition that the upper limit is not exceeded,each commercial bank according to the financial market interest rate change,decide deposit interest rate independently.In 2004,the process of interest rate marketization in China entered a new era,and the focus turned to promote the marketization of local currency deposit and loan interest rate.In October 2004,the central bank issued a document to release the upper limit control of loan interest rate in local currency and the lower limit control of deposit interest rate.After 2008,the fluctuation of deposit and loan interest rates has expanded in an orderly and steady way.In July 2013,the loan interest rate control of commercial banks was completely released.In terms of deposit interest rate,the central bank also released the upper limit control in October 2015,which marked a major breakthrough in the interest rate liberalization reform of deposit and loan in China.Since October 2015,China has released the direct control over the deposit and loan interest rate,but in the actual mechanism operation,as the deposit and loan interest rate published by the central bank still exists,commercial banks still price according to the benchmark loan interest rate when they carry out the deposit and loan business,and set the implicit lower limit of loan interest rate and the implicit upper limit of deposit interest rate when they carry out the loan business,It makes our country face the situation of interest rate two track system.On the one hand,in the bond and money market,the bond and capital interest rates are determined independently by the financial market based on the supply and demand situation;on the other hand,in the field of deposit and loan,although the upper and lower limits of the fluctuation of deposit and loan interest rates have been released,the benchmark deposit and loan interest rates still exist.When commercial banks carry out business,they mainly refer to the benchmark deposit and loan interest rates.Therefore,there are two kinds of interest rates(financial market interest rate,deposit and loan benchmark interest rate)in the market simultaneously.Since 2018,the central bank has made innovation and flexible use of monetary policy instruments,adopted medium-term lending facilities(MLF)and other means,moderately invested funds in the financial system to make liquidity reasonable and sufficient,and guided the market interest rate downward.The financing interest rate of domestic deposit financial institutions' bills,national debt,financial debt,medium and high-grade yield,etc.have dropped significantly,but due to the domestic deposit and loan interest Rate and market interest rate are parallel,the transmission of market interest rate to real economy is blocked,and the financing cost of real economy is high.According to the data released by the central bank,the weighted average interest rate of RMB general loans of financial institutions was 5.94% at the end of the second quarter of 2019,only 0.1% lower than that of the previous quarter,and still 0.14% and 0.03%higher than that of the end of 2017 and 2018.To sum up,in the current economic environment,it is more and more important and urgent to dredge the transmission mechanism of interest rate and make monetary policy play a better role by promoting "two tracks and one track" of interest rate.In April 2018,at the Boao Forum for Asia,Yi Gang,President of the People's Bank of China,said to the outside world that China will continue to push forward the reform of interest rate liberalization,so as to gradually unify the two tracks of deposit and loan benchmark interest rate and market interest rate.In May 2018,in the report on the implementation of China's monetary policy(the first quarter of 2018)issued by the People's Bank of China,the report mentioned that the implementation of interest rate marketization reform still faces some "hard bones"(that is,there is a "two track system" of interest rate),which requires the gradual completion of "two tracks" integration under the guidance of interest rate marketization.In May 2019,the People's Bank of China issued the China monetary policy implementation report(the first quarter of 2019),which focused on the analysis of the importance of unifying the "two tracks" of loan interest rate in the form of columns(including improving market competitiveness,reducing risk premium,reducing financing cost of small and micro enterprises,etc.).In the executive meeting of the State Council held on June 26,2019,it was pointed out that we should deepen the reform of interest rate marketization,improve the mechanism of quoted interest rate in the loan market of commercial banks,and better play the leading role of quoted interest rate(LPR)in the loan market in the formation of real interest rate.At the executive meeting of the State Council held on August 16,2019,the market-oriented reform method was deployed to significantly reduce the level of real interest rate and solve the financing difficulties,and the plan to reform the market quotation rate(LPR)mechanism of bank loans was clearly put forward.Next on August17,the People's Bank of China issued a notice([2019] No.15)saying,"in order to deepen the reform of interest rate marketization,improve the efficiency of interest rate transmission,promote the reduction of real economy financing costs,and decide to reform and improve the formation mechanism of loan market quotation rate(LPR)",the quotation method of LPR is based on the open market operating interest rate(mainly refers to the medium-term lending facility(MLF)interest rate)In addition,the quotation rate of the loan market will be expanded from the original one-year term to two term varieties with one-year term and more than five-year term.China's "interest rate integration" has thus taken a landmark important step.Based on the above background,this paper first combs the existing theories about interest rate policy and interest rate marketization(including domestic and international aspects),and analyzes the interest rate marketization in several representative countries and its impact on macroeconomic.Next,based on the mutual relationship between the promotion of interest rate marketization and the evolution of monetary policy,this paper analyzes the discovery process,current situation and theoretical defects of monetary policy in China,reviews the process of interest rate marketization in China,with a view to positioning the current situation and stage of domestic interest rate marketization.Then,the paper discusses the transmission mechanism of interest rate,and analyzes the transmission mechanism and influencing factors of interest rate under the background of interest rate dual track system.Using a number of empirical analysis tools,such as Granger causality test,correlation analysis,time difference correlation analysis and vector auto regression(VAR)model,this paper analyzes the effect of different nodes of interest rate transmission in China.Through empirical analysis,it is found that the transmission link from the open market interest rate of the central bank as the policy interest rate to the interest rate of the money market is blocked;the change of the interest rate of the financial market(including the interest rate of the money market and the interest rate of the bond market)can be transmitted to the financing cost of the real economy(the weighted average interest rate of RMB loans),but the transmission effect is poor,only showing weak effect;the financing of the real economy Within the financial market system,the transmission of interest rate from money market to bond market is basically effective.This shows that in the context of China's monetary policy is still in the transition period,due to the more use of quantitative tools,the imperfect interest rate policy,the existence of interest rate regulation and the lack of interest rate sensitivity in the real economy and other factors,China's interest rate policy is not smooth enough from the implementation of transmission to the final effect on the real economy,and the policy effect is not good.Next,based on the research of scholars at home and abroad,this paper closely follows the development process of domestic interest rate marketization,establishes a time-varying parameter vector autoregressive(TVP-VAR)model,and discusses the time-varying characteristics of interest rate variables on macroeconomic effects in the interest rate marketization environment.The results show that the process of interest rate marketization in China does not significantly promote the macroeconomic effects of interest rate policies Before 2013,the macroeconomic effect of interest rate policy was relatively stable(but weaker than that of quantitative monetary policy).After 2013,the macroeconomic effect of interest rate policy tends to weaken.The possible reason is that after 2013,China's economy experienced a period of active deleveraging,and then entered the stage of high-quality development.The economic growth rate slowed down,but the nominal interest rate adjustment lagged behind,and did not decline significantly with the slowdown of economic growth.At the same time,the transmission mechanism of interest rate is not smooth,and the transmission efficiency is low.Therefore,the marketization of interest rate in China needs to be further promoted.In view of the above problems,this paper gives some concrete suggestions: first,we should continue to steadily promote the marketization of interest rate and smooth the transmission mechanism of interest rate;second,we should continue to cultivate the market benchmark interest rate;third,we should enhance the sensitivity of market subjects to the change of interest rate,so that the current situation of soft constraints in the budget of state-owned enterprises can be changed,and the impulse of local governments in investment can be obtained Restrain,so that the financing behavior of local governments can be further standardized;fourth,create a fair competition environment,expand the access field of small and medium-sized enterprises,strengthen the supervision of small and medium-sized enterprises,and promote their orderly and healthy development;fifth,create a good external environment of "parallel interest rate";sixth,improve the central bank's interest rate regulation system,and accelerate the transformation of monetary policy from quantitative regulation to quantitative regulation According to the changes of economic fundamentals and financial market conditions,price based regulation can flexibly adjust the benchmark interest rate of short-term policy,so as to effectively guide the interest rate of money market;seventh,Change the regulatory concept of commercial bank bond investment and interbank business,so as to promote the healthy,standardized and sustainable development of these businesses.Next,this paper further analyzes the selection and cultivation of the benchmark interest rate system,and concludes that the medium-term lending facility rate(MLF)referred to in the current LPR is not suitable as the benchmark interest rate.It puts forward that the short-term and long-term benchmark interest rates respectively choose the inter-bank overnight repo rate(DR001),the medium-term and long-term treasury bond yield rate or the interest rate swap(IRS)interest rate linked the short-term benchmark interest rate as the proposal of market benchmark interest rates. |
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