China's Interest Rate Adjustments And The Stock Price Index-related Research

The stock market is an important part of financial market. It bear not only the financing and resource allocation functions of the media capital,but also the economic development of our country as a "barometer" also play an economic forecasts and found that the value of the function. Stock prices are many indicators to measure the development of the stock market in one of the most important indicators. In the actual operation of the economy,the factors affecting stock prices is very complicated,the whole macroeconomic,environment,political fators,the company operating conditions, have an impact on the stock price. Many factors affect stock prices,which is the most powerful financial factors. In the financial factors,impact of changes in interest rates on the stock market prices and is the most direct and expeditious.In many Chinese and foreign scholars found in a study of changes in interest rates and the stock price index, It exists a negative correlation between the relationship. Interest rates and stock prices on the relationship between the effective use of monetary policy,thus facilitating the money market and capital market development of the benign interaction is of great realistic significance. More mature foreign economic theory and empirical research methods, this paper from May 1996 to December 2007 between changes in interest rates and share price movements of the interaction between the two variables of correlation between short-term and long-term relationship. Empirical analysis shows that the interest rate movements on the stock market in the short term will have an impact,but the impact is not always shown regularity,it is a positive correlation in the long term.This paper includes the following six aspects: First, It have compiled the relevant literature and research context, the paper found that the empirical study of the two methods gradually mature. From the earliest found no correlation,the existence of correlation is not obvious later,and then show a certain correlation now. Secondly, It study the theory of interest rate movements on the stock price index of the relationship changes. In a regulated,mature and highly efficient operation,a certain size of the market in the securities market and the liberalization of interest rates and the market, as well as good macroeconomic environment and the rational choice assets expected the situation, the two show a negative correlation between variables. Again, it establishes the dual linear regression model and VAR model in short-term and long-term,and it analyses the relationship between changes of interest rates and the index of stock price. In the empirical analysis of China's drawn between interest rates and stock prices and the relationship between the theory of relations based on is inconsistent,in that China's interest rate policy and the stock market between the conduction mechanism has not yet perfect.Then,the corresponding policy recommendations is based on in the empirical analysis of the test results and the reasons.Finally,the paper summarized the conclusions of the limitations of this study,as well as further problems.