The Research To Monetary Policy Credit Transmission Mechanism In China

Monetary policy transmission mechanism is a course which monetary policyresults in the changes of real GDP and the percentage of currency inflation. Generallymonetary policy credit transmission mechanism only acts as the magnification andcomplement of the interest rate mechanism, which explains what the interest ratetransmission mechanism can't explain. However, monetary policy credittransmission mechanism has special meanings in China, which is the maintransmission mechanism. Since 1998, certain change takes place in the foundationthat the monetary policy credit transmission mechanism depends on. So, It is veryessential to research the present monetary policy credit transmission mechanism.Combining the western modern theory of monetary policy credit transmissionmechanism, I research the monetary policy credit transmission mechanism under theclose economic condition in China, focusing on the financial market and commercialbank system.There are great changes in the financial market and commercial bank system inChina which will affect monetary policy credit transmission mechanism in manyaspects. On one hand, the whole development of the financial market will clear up thebank credit transmission mechanism. Meanwhile, the development of the financialmarket will play a intensive role to the balance sheet transmission mechanism. On theother hand, the surplus of the system of commercial bank, credit rationing will exert agreat influence on the monetary policy credit transmission mechanism.To promote the development of middle—small scale financial institutionsespecially middle—small scale commercial banks is the main method. It will behelpful to monetary policy credit transmission mechanism. Meanwhile, to promotethe financial market and commercial banking system will be helpful to the balancesheet transmission mechanism.