Study On Multi-channels Of Monetary Transmission And Impedimental Factors

In recent years, to control the deflation, startup investment and consumption, central bank has carried out positive monetary policy, but the effect is not significant. The effectiveness of monetary policy is determined by the content, characteristic and function mechanism of the money transmission channel. So the channel of money transmission becomes an important task in the field of politics and economics.On the basis of several kinds of scientific research methods and the economic development reality in which the money transmitted, this paper analyzed the characteristics and trends of monetary policy transmission in China, and discussed the path choice for the establishment of monetary policy multi-transmission channel.The main conclusions in this paper are as follows:(1) Since 1998, the credit channel of monetary policy in China has weakened, but it still plays an important role in the monetary transmission. (2) Explanation degree of interest rate to the whole macro economy variables is very limited, but this explanation degree has enhanced a lot in near economic period. (3) Asset price especially the stock price in China has basically no correlation with enterprises investment and it has more substitution effect than wealth effect on household consumption, but it has large demand elasticity for money. (4) The change in exchange rate affects more on export than import and it also has an impact on money supply via the purchase of foreign exchange. In addition, the foreign exchange policy always results in conflicts with monetary policy.(5) At present, the main factors that affect the effectiveness of monetary transmission are incompleteness of financial market system, non-market behavior of commercial banks, interest rate control, dependence of central bank and the slow reaction of the enterprise and household to the market signal.(6) The suggestions to perfect monetary multi transmission channel are as follows: â‘ To develop the money market and the linkage to capital market. â‘¡To enhance independence of commercial bank and central bank. â‘¢To advance of the reform of interest rate and exchange rate system. â‘£To perfect the micro basic for macro control.