Effect Analysis Of Negative Interest Rate Policy And Its Enlightenment To China’s Monetary Policy

The outbreak of the financial crisis in 2008 severely hit the global economy.In order to recovery the economy,central banks of many economies implemented quantitative easing monetary policies,but the implementation of this unconventional monetary policy did not achieve the expected effect.As a result,economies led by Sweden opened the door to apply negative interest rate monetary policy.Since then,Denmark,Euro zone,Switzerland,Japan and other economies also joined the camp of negative interest rate policy in succession,and the era of negative interest rate has come.The outbreak of COVID-19 in 2020 has once again impacted the global economy.Economies around the world are constantly calling for negative interest rate policy,and issues related to negative interest rate monetary policy have once again entered the horizon of academia and the public.Therefore,it is particularly important to systematically study negative interest rate policy and its enlightenment to China’s monetary policy.Based on the relevant theories of negative interest rate policy,this paper first systematically sorts out the economic environment,causes,application process and transmission mechanism of negative interest rate policy implementation in foreign economies.On this basis,using the central bank’s policy interest rate and the output,prices,unemployment and exchange rate corresponding to the ultimate goal of monetary policy,the VAR model is constructed to empirically test the practical effect of negative interest rate policy in two typical economies of the Euro zone and Japan.The study finds that: Japan’s negative interest rate policy does not achieve the goal of overcoming deflation,but can stimulate output and reduce unemployment rate to a certain extent.The negative interest rate policy in the Euro zone deviates from the target of the European Central Bank,not only does not increase the level of inflation in the euro zone,but also has a certain restraining effect on inflation.Meanwhile,it does not relieve the pressure of euro appreciation and reduce the unemployment rate,but only has a certain stimulating effect on output.In addition,a comparative study is conducted on the current situation of China’s economy and the economic environment and motivation before the implementation of negative interest rate policy in foreign economies to explore the applicability of negative interest rate policy in China,and it is concluded that China does not yet have the economic environment and necessary application of negative interest rate policy.Finally,based on the current background of high-quality economic development in our country,the following three countermeasures are put forward: strengthen the coordination between fiscal policy and monetary policy,focus on financial risks under easy money conditions,create favorable financial system facilities and market environment for monetary policy transmission.