The Mechanism And Effect Of Structural Monetary Policy Tools

Since the financial crisis,countries had adopted quantitative easing policies to stimulate their economic recovery.These policies had functioned well in some aspects,but also brought many other problems,such as inflationary pressures and so on.With the gradual appearance of QE's disadvantages,the major economies in the world have been trying to implement the "qualitative easing" monetary policy.Currently,China's overall liquidity environment shows a coexistence of total abundance and structural shortage,so People's Bank of China introduced a number of innovative structural monetary policy tools.This thesis takes PSL as an example to analyze its characteristics of type,objectives and operation mode.Based on the explanation of its mechanism,the paper also applies case study method to the research on PSL's implementation effect.The empirical results show that the policy effect of PSL is relatively significant,it can effectively reduce the medium-term interest rates and lower social cost of financing in part of the implementation phase,but the effect is relatively small and unstable in other phases.Therefore,the People's Bank of China needs to play a regulatory role through market mechanism,optimize the proportion of risk and high-quality assets and improve the credibility of the policy statement.