Research On The Effectiveness Of China’s Monetary Policy Inlfation Governance

After the outbreak of the international financial crisis in2008，China’s investmentand exports decreased a lot，Since the second half of2008， China’s CPI and PPI fromhigh showed a trend of rapid decline， The2009inflation rate fell from5.9%in2008to-0.7%，It’s the overall price level fell for the first time in the last seven years since2002.However，from July of2009，China CPI and PPI touch bottom rebound，The negativegrowth gradually transformed into positive growth，the overall price level began to rise，In2010reached3.3%，20115.4%， More than5%of the international warning linelevel. Although China prices in2012，2013rally more gentle， But inflation is still thecurrent China’s most prominent economic problem.Facing the continuously bigger inflation pressure since2010， The people’s Bank ofChina changed the moderately easy monetary policy to moderate. The people’s Bank ofChina flexible developed the open market operations， Continuously adjusted thestatutory deposit reserve ratio and interest rates，Continuously enhanced RMB exchangerate flexibility and established macro Prudential policy framework and other measures tostabilize the domestic price level.Firstly,this paper analyzed the the performance characteristics of Chinese inflationand causes since2010, and then evaluated the effect of the central bank to takeappropriate monetary policy, again using eviews6.0software for Chinese money supplyon the basis of2010-2013, total loans and deposit-taking financial institutions andexchange rate index and monthly indicators monthly inflation rate for the empiricalanalysis, the China’s monetary policy is valid conclusions. Finally, this paper presents thedeposit reserve system reform, open market operations, to promote the effectiveness ofpolicy recommendations and a series of interest rate market to enhance China’s monetarypolicy to control inflation.