A Comparative Study Of Inflation Targeting Regime Across Nations And Its Adaptability In China

Since 1990s, inflation targeting regimes have been adopted by a growing number of central banks in industrial and emerging economies as a new monetary framework. At the same time, these central banks gave up the traditional intermediate targets of monetary policy, such as money supply and interest rates. In practice, these countries control the inflation level successfully in this framework. Countries with inflation targeting, mostly experienced a high rate of inflation and instability in the domestic economy, gave up the money supply, nominal exchange rate as intermediate target of monetary policy works. The failure of traditional monetary policy and the appearance of so many problems, ultimately makes these countries turned to the implementation of inflation targeting. Meanwhile, it is proven that the inflation targeting policy has a significant effect on price stability and economic stability. Because of the good performance of implementation in these countries, the inflation targeting gradually draw the academic and political concern. Through careful observation, the countries of implementation of inflation targeting in the world have the different backgrounds, and it is the results of a combination of factors. Nevertheless, careful observation of these countries, it was easy to find something in common. On the other hand, the intermediate target of money supply in our country get a lot of criticism, the International successful experience of implementation of inflation targeting provides an appropriate reference and reference for China. Whether it is applicable in China, is the concern of this article.This article is on the basis of elaborating the theory of the inflation targeting system, and then carry on the comparison and the analysis to the successful implementation experience in these countries, getting a great understanding of the common condition and the foundation of the successful implementation in these countries, including various countries' implementation's background, the implementation time, the implementation frame, the policy operating process and the implementation effect. There is a certain general character between various countries, and simultaneously certain different characters. Secondly, china, as an economic nation with rapid growth, the requirement of the monetary policy also was promoted. This paper focuses on the economic conditions, institutional conditions, technical conditions, controlled conditions, measurable conditions of the implementation of inflation targeting in China. And get a conclusion that the implementation still has a great difficulty. In the last, to sum up, although the intermediate targets and inflation targeting system are not suitable for our country, but we can still keep the money supply as an objective, taking the advantage from the inflation targeting system for our monetary policy and thinking. At this time, our country should work on establishing a sound financial ecological environment, improving the central bank's independence, increasing the ability of inflation forecast. Our aim is to establish a more efficient, transparent and efficient financial conditions.The innovation of this article is the study and comparison of the successful experiences in different countries, and it got a good understanding of the conditions and infrastructure of implementation of the inflation targeting. And then this article studied the necessity and practicability of inflation targeting in China, and got a result that it is not suitable for our country. Nevertheless, inflation target system is still worth learning and reviewing, and this article raised some suggestions, hoping it useful for our monetary policy. The deficiency of this article is not raise a perfect monetary policy framework for our country, but only the suggestions.