Treasury Bond Yield Curve Forecast And Its Monetary Policy Implications

With the continuous deepening of the reform of the financial markets and treasury bonds and trading scale, in terms of liquidity or market information to reflect currency regulation levels are proposed bond yield curve reflects sound capital market supply and demand requirements. The importance of the Treasury yield curve is that it can provide information on the pricing benchmark interest rate on various types of assets in financial markets, but also includes the market expectations of future economic and other information. Reflecting market supply and demand through the establishment of the Treasury yield curve helps improve the degree of market microstructure of financial markets, but also conducive to observe the changes in the yield curve by the monetary authorities in order to understand the market expected, and then develop appropriate monetary policy influence the yield curve changes to achieve the impact of market expectations, to achieve the ultimate goal of monetary policy purposes.In this context, this paper investigated the impact of monetary policy on macroeconomic forecasting ability of the Treasury yield curve, on the one hand for us to judge the impact of monetary policy on short-term interest rates as well as the Treasury yield curve conduction is valid, on the other hand but also conducive to whether monetary policy by influencing the Treasury yield curve is expected to be able to guide the market, thus achieving control objectives, provide empirical support.Firstly, the relevant research literature at home and abroad to sort out, inspect the bond market development and preparation of the Treasury yield curve, short and long term bonds later on the basis of macroeconomic forecasting theory spread, a measure of monetary policy variables and monetary policy and bond yield curve the logical connection issues such as theoretical analysis. Based on the above test short and long term government bonds spreads on economic growth and inflation forecasts ability to analyze the impact of monetary policy on short and long term government bonds spreads predictive power. Further, analysis of rationality and enlightenment empirical results of monetary policy transition. This paper analyzes the conclusions and policy recommendations related to:(1) short and long term bonds spreads can predict the future changes in macro-economic growth and inflation, and the long and short term government bonds spreads on macroeconomic growth was stronger than forecast inflation forecasting ability; (2) changes in monetary policy is the short and long term bonds and interest rate forecast an important factor in the ability to influence macroeconomic variables; (3) short and long term bonds spreads have met the relevant criteria and controllability, but testability is still insufficient. Short term, long and short term government bonds spreads become the intermediate target of monetary policy conditions are not sufficient. But at this stage, short and long term bonds can be used as important reference information spreads Chinese monetary policy to achieve price stability and economic policy objectives of the service; (4) should be improved varieties and ways of treasury bonds, the bond market to enhance the liquidity of the development Treasury derivatives, market-oriented and improve the accuracy of the Treasury yield curve. In addition, the monetary authorities may be long and short term interest rate bonds included in the monetary policy reference information, and dynamically adjusts the weights based on the strength of information at different times of the yield curve slope prediction capabilities, and enhance the reliability of forward-looking monetary policy.