Research On The Stock Price And Inflation Rate Of China

The stability of price is the ultimate goal of a nation's macro economy. As the development of stock market, the fluctuation of stock index has strong influence on the inflation, so it has been discussed heavily among nations whether stock index should be considered as main cause of inflation. The stock market in china has developed so well since its foundation, and most residents keep stocks as a part of their portfolio, the price of financial assets has strong influence on macro economy. The research of the relations between stock index and inflation has been put on schedule since then.This paper focus on the relations between price index and inflation, using the concepts of classical economics and Keynes macro economics. The main topic will be the influence of stock index on the consumption and investment. At the same time, this paper discusses the topic of the level of stock index influence the consumption and investment. On the other hand, this paper employs the latest statistics using the empirical method. This paper not only discuss the relations between stock index and the inflation, but also study the topic of whether stock index should be included in the cause. Finally, this paper will give some suggestions.In the process, this paper focuses on the combination of theory and practice, and based on China's real economy background. So we can get the credible results, and give some useful suggestions to the development of stock market and promote the macro enviroment more and more healthy.