Research On The Spillover Effect Of China's Monetary Policy On The "One Belt And One Way" Country

As China's economic and trade ties with the "one belt and one way" countries are becoming increasingly close,and the process of RMB internationalization is accelerating,China's monetary policy,while regulating its financial market and guarding against financial risks,will inevitably have spillover effects on the "one belt and one road" country.Therefore,we should study the spillover effect of China's monetary policy on the "one belt and one way" country,clarify the spillover strength of different types of policy tools,thereby reducing the negative externalities of other countries.Through the coordination of international policies,achieving cooperation in the region,reflects that China is a responsible big country.Based on the existing monetary policy spillover model,this paper analyzes the four transmission mechanisms of monetary policy spillover in a country,and then selects 20 representative monthly data of the 131 countries from January 2008 to November 2018.Through the PVAR model,This paper studies the spillover effects of China's quantitative monetary policy and price based monetary policy on the short-term interest rates of the 20 "one belt and one country" money market,the RMB exchange rate,the change of the consumer price index and the stock market index change under the direct quotation method.The empirical results show that:first,China's monetary policy will spill over to the "one belt and one country" country,which will have an impact on the interest rate,exchange rate,consumer price index and stock market index of the "one belt and one road" country,and the spillover effect in the short run is greater than the long-term effect.Second,China's monetary policy has a relatively large impact on the interest rate and exchange rate of the "one belt and one way" country,and the spillover effect is relatively strong.Thirdly,the impact of quantitative monetary policy instruments on foreign countries is less than that of price monetary policy.The following suggestions are put forward as follows:first,monetary authorities in China should carry out regular communication with the "one belt and one way" national monetary authority,strengthen international policy coordination,so as to reduce the impact of negative spillover effects on policies of other countries;second,enrich and improve diversified monetary policy tools to cope with the complex and changeable economic and financial environment;third,strengthen the right policy.The supervision of short-term cross-border capital flows will further promote the RMB exchange rate formation mechanism;fourth,further develop and improve China's capital market.