An Empirical Study On Monetary Policy Trasmission Mechanism Through Stock Market

Of the 1990s, as China's rapid development of socialist economic construction and economic reform to push, China's stock market has been rapid development, which in the national economy occupies an increasingly important. The role on the conduction of conventional monetary policy mechanism produced the impact can not be ignored. In particular, began in 2005 with the split share structure reform, the overall advancement of China's stock market finished the great historical turning point, the stock price index is climbing, the huge volume of amplification, the residents share of the asset structure in the stock continued to increase, money market and stock market continue to strengthen the links, the stock market as the national economy "barometer" of the growing role of China's real economy gradually. Size and structure of the stock market continues to change the money supply and demand, affecting.the transmission mechanism of monetary policy and monetary policy instruments, the traditional objective of monetary policy transmission mechanism with the operating system and face increasing challenges.In this economic context, to improve the level of macro-control and transmission efficiency of monetary policy to maintain the health and stability of the national economy has significant theoretical and practical significance.This paper has conducted a more in-depth research on monetary policy transmission mechanism of stock market. Which are Specifically divided into two phases, the first stage, how the transmission of monetary policy to the stock market, the second stage, how the monetary policy conducted by the stock market to the real economy. On this basis, with Eviews5.0 share reform in China after the software to do the empirical analysis of data analyzed by the monetary policy interest rates, money supply channels transmitted to the stock market and the stock market affect the real economy, consumption and investment effects, Finally, draw conclusions and make policy recommendations. From a structural point of view, this is divided into five chapters.The first chapter is an introduction, including the significance of the topic of this article and explained the background literature review and structural arrangements of articles, ideas and innovation and inadequate.The second chapter on monetary policy transmission mechanism and transmission mechanism of monetary policy stock market has combed the theoretical framework, focusing on the monetary policy transmission channels of the stock market, interest rates, money supply channels and the transmission of monetary policy by the stock market to the real economy of consumer effects and investment effects.Chapter III of the transmission mechanism of monetary policy and the evolution of the development process of China's stock market, a brief review and analysis of general, so that the next chapter, empirical analysis can be better adapted to national circumstances.Chapter IV is the stock market of monetary policy transmission mechanism Empirical Study. This section is divided into two phases. The first stage is the monetary policy impact on the stock market means empirical analysis, including money supply and interest rates means the empirical analysis; the second phase of the stock market, the impact on the real economy means empirical analysis, including ways of consumption and investment channels empirical analysis. Data sample range is the first year of the split share structure reform, January 2005-2010 monthly data in December. The first phase of empirical analysis concludes that the EG cointegration test shows that the broad money supply and stock market capitalization Cointegration and one-way Granger causality; national interbank interest rates and stock market capitalization does not exist cointegration and Granger causality relationship. VAR-based system Johanson cointegration test shows that the market value of the stock market liquidity, money supply and lending interest rates between the three long-term stable relationship. Among them, the stock market and money supply in circulation there is a positive relationship with the existence of a negative relationship between interbank rates and money supply, the impact on the stock market is greater than the inter-bank interest rates. Empirical analysis concludes that the second phase of EG cointegration test shows that total retail sales of consumer goods and stock market liquidity of the market value of long-term stable relationship does not exist; total fixed asset investment and stock market liquidity of the market value of long-term stable relationship exists, and exists between the two one-way Granger causality. VAR-based impulse response function of the system analysis and variance decomposition can be seen, the stock market liquidity of the market value of the contribution of investment in fixed assets, compared to financial institutions, credit is still relatively low. This indicates that the commercial banking system, the credit transmission mechanism leading monetary policy transmission mechanism in the still occupy the first priority.Chapter V Based on the foregoing sections of theoretical and empirical conclusions, combined with China's national conditions, have tried to put forward to improve and perfect the monetary policy transmission mechanism of stock market a number of policy recommendations.