A Study Of Relationship Between Consumer Credit Balance And Overall Economic Activity Of Our Country

Over the past two decades,China's economic and social structure,the financial environment has undergone tremendous changes,personal consumption habits and concepts have changed significantly,the People's Bank of China announced the total amount of bank credit balance,in addition to representing the bank's loan business What is the economic significance implied by the total amount of bank credit balances?Does it represent the improvement of the economic situation?What factors have contributed to changes in the total amount of bank credit balances?How to understand the overall balance of bank credit through the overall economic activity is due to excessive competition and produce unreasonable surge phenomenon,and then be vigilant?Therefore,this paper,based on the balance of consumer loans,to explore its relationship with the overall economic activities,analysis of the overall economic activity which is caused by changes in consumer loans to increase or decrease the main factors.This research investigates the relationship of macroeconomic activity and consumer loans.Monthly data are collected from 1998.07 to 2015.06,totaling of 204 observations.The macroeconomic variables considered in this paper include consumer price index,loan rate,money supply,stock index,rate of unemployment and personal income,all of which are adopted to analyze the impact of the macroeconomic condition on the consumer loans.This research firstly tested stationary by unit root test.Granger causality test is used to investigate the lead-lag position among variables,Variance Decomposition(VDC)and Impulse Response Function(IRF)are also employed for testing the impulses caused by shocks of each variable and the relative exogenous among variables,and the Cointegration test used to analyze the long-run equilibrium relationship and further apply Vector Error Correction Model(VECM)to examine the short-run dynamic relationship among variables considered.After we take above steps we can find the results as follows:Firstly,consumer price index seriously leads the consumer loans,and is useful while predicting the consumer loans.The consumer loans have feedback relationship with consumer price index,and only have one-way connection with stock index.Secondly,when the impulses caused by shocks of each variable,consumer loans are mainly explained by consumer price index,although it have strong exogenous and the explaining power are more on themselves through Variance Decomposition.From the viewpoint of the Impulse Response Function,the consumer price index mostly impact consumer loans with negatively fluctuate.Moreover,it also shows us a positive impact to stock index.Finally,between consumer loans and macroeconomic factors there is a long-run equilibrium relation.Under long-run equilibrium relationship,consumer loans are affected by personal income,stock index and rate of unemployment where exists a co-movement condition,Moreover,consumer price index and money supply and loan rate apparently has negative effect on the consumer loans,the short-run dynamic findings show that the consumer loans is tend to be obviously influenced by earlier two stage consumer price index.