| In recent years, Chinas has maintained sustainable development in macro-economic and steady growth of the gross domestic product, but due to the excessive growth of investment, credit and excessive trade surplus,Chinas economic overheating risks have gradually increased. From2007, the central bank began to implement the deflating monetary policy frequently to control bank credit to ease the excess liquidity situation. Since2007to the second half of2011, the central bank has a total of31times to adjust the statutory deposit reserve ratio, rose sharply to21.5%from9%before the adjustment, the statutory deposit reserve ratio to a record high. In recent years, the tightening intensity of taking statutory reserve policy measures by central bank is unprecedented. Taking into account the role of the monetary multiplier effect, the expected effects of its policy should be very obvious, but in fact in recent years, Chinas inflationary pressure is still larger. Do deposit reserve policy work well in curbing inflation? What is the policy transmission mechanism? Is its effect short-term or long-term? Whats the specialfeature in our country? What factors affect the role of this policy? How to make better use of good in this policy? These are the main issues this papertries to focuson.The first part is trying to introduce the theoretic albasis of the policy, the evolution of the system, Chinas reserve adjustment process of the policy, the causes and characteristic s of Chinas inflation. The main part is analyzing the impact of adjustment of deposit reserve policy in thre e aspects including changes in the money multiplier, money supply changes, as well as the consumer price index.. The conclusion is that the effects changes in the deposit reserve ratio of money supply regulation do have a role in inhibition of inflation but is not very obvious in the period. The presence of central bank paying the interest for reserve money, the commercial banks holding large excess reserves,the passive delivery of the base currency and other factors led to theweakening effect of the adjustment of reserve ratio. The final part of thispaper suggests that it would be better if the government improve thereserve policy and the fiscal policy and curb excess liquidity from thesource to control macroeconomic regulation. |
