Study On The Interactive Relations Between China's Stock Maket Development And Monetary Policy

The main purpose of this paper is to study the interactive relations between China's stock market development and monetary policy. Against the characteristics of the subject, the paper uses the combined research methods of theoretical analysis and positive analysis.First, this paper makes an overview of stock market development and monetary policy theory. On the one hand, introduces the overview and the characteristics of China's stock market development; on the other hand, introduces the monetary policy, including ultimate goals, intermediary goals, transmission mechanism and tools of monetary policy.Secondly, this paper carries on theoretical analysis to the interactive relations between stock market and the monetary policy, based on the analysis of their internal relations, on the one hand, analysis influences of stock market development on monetary policy, including the influences on ultimate goals, intermediary goals, transmission mechanism and tools of monetary policy; on the other hand, analysis influences of monetary policy on stock market development, including the influences on interest rate, money supply and exchange rate.Thirdly, this paper carries on positive analysis to the interactive relations between the China's stock market and the monetary policy, on the one hand, analysis the influences of stock market development on economic growth, velocity of money circulation, money demand and transmission mechanism; on the other hand, analysis the influences of interest rate, money supply and exchange rate on stock market development, then confirmed the existence of interactive relations between them.Finally, based on the theoretical analysis and positive analysis to the relationship between the stock market and the monetary policy, this paper puts forward the policy proposal in order to achieves expectation which the two can harmonious development.