Credit Bond Market And Monetary Policy Transmission Mechanism

Monetary policy is favored and loved by central banks of all countries and has been widely used for its flexible and convenient operation.Although monetary policy has obvious advantages in flexibility,its effectiveness is still controversial.In order to study the effectiveness of monetary policy,it is necessary to conduct a more in-depth study on the transmission mechanism of monetary policy.Throughout the literature on the transmission mechanism of monetary policy,it basically develops from several dimensions,such as interest rate transmission,credit transmission,exchange rate path and asset price path.But in the practice of monetary policy,the central bank through open market operations affects currency market,money market determines the short end of the interest rate market interest rates,through long term structure of interest rates transmission to the end,the interest rate market conduct again by benchmark interest rates and credit spreads to the credit market,and affect the enterprise investment behavior,conduction to the real economy.Therefore,it is of great theoretical and practical significance to attach importance to the credit bond market and sort out the indispensable role and mechanism of credit bond market in the transmission mechanism of monetary policy.This thesis studies the transmission channel of monetary policy from the perspective of credit bond market.By combing the changes of the transmission channel of China’s monetary policy and the development process of China’s bond market and credit bond market,this paper makes a qualitative and quantitative analysis on the action mechanism of credit bond market in the transmission channel of monetary policy.On one hand,qualitative analysis shows that the central bank affects the money market through monetary policy tools of different maturities and different natures.From the perspective of the money market,the most important observation indicators are the overnight repo rate and the seven-day repo rate.The money market can be transmitted to the interest rate market,and the impact can be transmitted from the short-term interest rate to the long-term interest rate through the term structure of interest rate.With the help of credit spread and the change of basic interest rate,the impact can be transmitted from the interest rate market to the credit market,so as to affect the financing cost of enterprises,then affect the investment behavior of enterprises and transmit to the real economy.On the other hand,the results of quantitative analysis suggest that:(1)Open market operation rate has a significant and positive effect on money market rate which means that the transmission from the is smooth.However,it is worth noting that the policy signal of open market operation itself can be directly transmitted to the interest rate market and credit market.(2)Except a few periods,the transmission of benchmark interest rates to the credit bond market has been smooth.(3)The influence of benchmark interest rate on credit spreads is asymmetrical.When the yield rises,the yield of the credit market tends to rise faster,forming a positive feedback mechanism;When the yield goes down,the downward range of the yield in the credit market may be lower than that of the benchmark interest rate.This asymmetry deserves special attention from policymakers.