International Comparison Research Of The Inflation Targeting Regimes And Suitability In China

Since1990s, inflation targeting regimes have been adopted by a growing number ofcentral banks in industrial and emerging economies, as a new monetary framework to conducttheir monetary policy. With the comparative advantages, the performance of inflationtargeting regimes has been quite good. Inflation targeting countries have significantly reducedboth the rate of inflation and inflation expectation, stabilized the growth of output, increasedthe credibility of monetary policy, and achieved price stability. The country’s successexperience is worth learning and using for reference. It has very important practicalsignificance that study of these countries inflation targeting monetary policy system and theconcrete application of the relevant experience and lessons for the reform of China’s monetarypolicy and maintain the good macroeconomic operation.First, the Paper mainly put focus on analysis the mechanism of inflation targeting.Second, the Paper show international experiences of inflation targeting based on severaldifferent groups of New Zealand, Canada, Israel and South Korea and summarized thenational implementation of inflation targeting experience. At last, we analyze the obstaclesfactors of China’s inflation targeting regime and put forward the foreign inflation targetingregime on China’s monetary policy framework of the enlightenment.It make a conclusion that inflation targeting regime is an effective and practical monetarypolicy framework, which can reduce the inflation rate and expectation, stabilize the outputgrowth, enhance the transparency and accountability of central bank. The Paper based on theeconomic and institutional aspects of China suggests that although our country is not suitablefor implementation of inflation targeting, foreign inflation targeting practical experience forthe future of our country effective monetary policy provide several important theoreticalframework of revelation: Our country should be the price stability in monetary policy priority,strengthen the independence of the central bank and perfect financial market.