The Research On China's Monetary Policy Transmission Mechanism

Monetary Policy is one of a country's main macro-control policies. The forms and efficiency of Monetary Policy Transmission Mechanism have a direct impact on the operation of macro-economic. Monetary Policy Transmission is the most complex and practical problem of financial operations and economic regulation in China. It is related to macro-economic policies, micro-economic operations and the final choice of Monetary Policy.The introduction of this paper explains an important premise of the Monetary Policy Transmission Mechanism, pointes out the importance of studying on it, introduces the status quo in domestic and abroad. It also concludes the problem to be solved and the theoretical and practical value in this paper.Part1 introduces the basic theories of Monetary Policy Transmission Mechanism. It concludes the contents of the Monetary Policy, the Monetary Policy Transmission Mechanism and the western theories of the Monetary Policy.Part2 describes the development process, the interrelated reform and the status quo of the Monetary Policy Transmission Mechanism in China. The China's Monetary Policy Transmission Mechanism is basically adapted to the current economic situation by four-stage development and a series of central bank reform.Part3 analysis the resistance and causes of China's Monetary Policy Transmission Mechanism from the executing agency, the financial intermediations and the micro-bodies in detail. In conclusion, the main problems are: The Central Bank represents in the lack of flexibility, initiative and independence in controlling the Base Money; the problems of financial intermediations represents in the commercial banks, Money Market, Capital Market and The Foreign Exchange Market; the problems of micro-bodies represents in the businesses and residents.Part4 gives some suggestions of improving the Monetary Policy Transmission Mechanism of China. The main contents are: reinforcing the capacity of the Central Bank; continuing to deepen the reform of commercial banks; enhancing the construction of Money Market, Capital Market and the Foreign Exchange market in China; strengthening the construction of micro-bodies to improve the effectiveness of monetary policy transmission.