The Impact Of Interest Rate Policy And Corporate Expectation On Cash Flow Risk

Under the background of the supply-side reform which requires oriented regulation and precise force of monetary policy,how to develop a scientific interest rate policy,carry out a market-oriented interest rate reform and promote a development of the real economy has become an important issue for financial policy makers and market regulators.To establish scientific policies,it is necessary to grasp the effect of policies.Examining the impact of interest rate policy on micro enterprises can judge the effect of financial policy relatively accurate.Under this context,this paper will treat adjusting the loan interest rate as a policy event,using event study research method to find out the influence of interest rate policy on corporate cash flow risk under different enterprises expectations toward macro economy and compare the direction,intensity and significance of this influence on this basis.This paper uses the data of 2010-2015 Chinese Shanghai and Shenzhen A-listed industrial companies,uses the change of one to three-year long-term load interest rate as the subject of policy changes to observe.This paper selects interest rising on October 20,2010 and July 7,2011 and the reduction of interest rate on March 1,2015 and June 28,2015 respectively as four events,using event study to analyze the evolution and generation of sample cash flow risk in four cases which match different enterprises expectation to different directions of interest rate adjustment.Empirical results show that under the upstream economy of enterprise expectation,the raise of loan interest rate would expand the corporate cash flow risk.However,because of the expected effects and policy effects are in opposite direction,the influence is not significant.While the reduction of loan interest rate would expand corporate cash flow risk significantly.Since the enterprise expectations and interest rate policy generate cash flow risk in the same direction at the same time,from internal and external simultaneously drives the evolution of cash flow risk.Similarly,under the downturn economy of enterprise expectation,the interest rate increase would significantly reduce cash flow risk,and interest rates reduction would reduce cash flow risk,but this effect is not significant.In addition,empirical examination also finds out that comparing with it in the period of rapid economic development,corporate cash flow risk changes less violently in the period of economic downturn,This paper is positioning in the interaction of macro-financial policies and micro-enterprises behavior,therefore the conclusions of this paper has certain reference value for both macro-financial policy development and micro-enterprise cash flow management.