| The relationship between the monetary policy and stock market has been in the forefront of monetary policy research topics. Theoretically speaking, the stock market is the barometer of the national economy, and the movements of stock price driven by the national economic situation is widely accepted by the theorists in foreign countries. Macroeconomic determiner believe that the price fluctuations of the stock market are determined by the changes of the macroeconomic situation. It exists a relatively stable relationship between the fluctuations of the stock price and macroeconomic variables, and it is the embodiment of the macroeconomic efficiency of the stock market.As far as efficiency is concerned, the degree of competition and the degree of integration of financial markets could be found to be the decision of efficiency of the capital market system. Our stock market has made tremendous development since its inception, but the stock market system will be perfected. Nevertheless, in the long run, our stock market is developing towards a competitive capital market. At present, many economists in our country has begun to concern the affect of asset prices to macroeconomic and monetary policy implications. The emergence and development of the capital market will change the existing monetary policy framework, and monetary policy transmission channels will be more complex.The article analyzes the relationship between stock prices and inflation and gives a reason. Test results reveals that there is a negative correlation between China's stock prices and inflation. moreover, from the impact from money supply and actual economy impulse to stock prices and inflation, we get the underlying causes of the negative correlation between the stock prices and inflation and give a monetary policy suggestion. |
