Research On The Effectiveness Of Monetary Policy Under Different Exchange Rate Regimes

Exchange rate management mechanism has always been an important part of the national economic and financial areas.The government's choice and judgment of the exchange rate management mechanism directly affects the statewide macroeconomic operation and the effectiveness of monetary policy.Based on the study of the effectiveness of different exchange rate control mechanisms and monetary policy,this current research is based on the classic Mundell-Fleming model,which is widely used in academia.The F-M model is revised according to the current national conditions of China.This current paper also studies the effectiveness of monetary policy under different exchange rate management mechanism in China,and analyzes the reasons for the conflict between the current exchange rate management mechanism and the effectiveness of monetary policy.At the end of the study,the author puts forward some suggestions on how to optimize our exchange rate management mechanism in view of the current situation and the existing problems.Based on the study of the effectiveness of the exchange rate management mechanism and the monetary policy,this study is based on the classic Mundell-Fleming model,which is widely used in the academic field,and the model is revised according to the current national conditions.Through the study and combing of a large number of Chinese and foreign literatures,this paper adopts the method of combining quantitative and qualitative.In addition,make their own judgments and research on the effectiveness of monetary policy under different exchange rate regimes in China.This paper examines the main conflicts between the two in 1994 and analyzes the causes of the conflict in the context of the domestic and international environment at that time.In this paper,the author analyzes the relationship between the exchange rate system and the domestic and foreign theories.Through empiricalresearch,this study draws the following conclusions: The correlation between monetary policy(quantity and price)and policy objectives(output and price)is enhanced compared with before the reform.From the impulse response analysis results can also be found to improve the effectiveness of monetary policy,in particular,the impact of price-based monetary policy(interest rate)on the price and output is relatively large and has a lasting,quantitative monetary policy(M2)The impact of output has also been significantly improved.Overall,the price-based monetary policy has played a regulatory effect significantly.In addition,the impact of exchange rates on prices and output has also shown a more pronounced improvement,particularly the extent and duration of exchange rate transfers.Therefore,after the reform of the People's Bank of China to adjust the exchange rate need to consider its impact on monetary policy.Finally,the countermeasures and suggestions are put forward according to the specific environment and problems faced by China's domestic and international macroeconomic development.Such as optimizing the formation of exchange rate basis and stabilizing the value of RMB.In order to achieve China's macroeconomic rapid,healthy and stable development of the principles of countermeasures and suggestions.It is hoped that through the research of this paper,we will provide suggestions for future theoretical and practical research.The innovation of this research is mainly reflected in the relatively new perspective.Most of the previous research literature are carried outfrom multiple countries.Even from a country perspective,the exchange rate system is rarely divided into a single fixed exchange rate system and a managed floating exchange rate system for two periods and stages.This article combines China's specific national conditions and takes China's reality as the starting point.The current researchis comprehensively expounded from both theoretical and empirical perspectives,and the research perspective is novel and unique.In addition,the current research is divided into the stage of the fixed exchange rate system before the exchange reform and the floating exchange rate system after the reform,to analyze and compare the effectiveness of themonetary policy under these two stages.It is hoped that this research will provide theoretical reference and realistic support for further improving the exchange rate system and monetary policy of China.