The Equilibrium Level Of Demand For China's Currency Regulator An Empirical Study

China's central started in 1984, the central bank functions, in 1994 to control the money supply identified as a means of monetary policy, which makes the exploration of China's demand for money both in theory and practice has an important significance. The money demand function is the implementation of monetary policy, monetary authorities in the most important basis and foundation for one. Therefore, the search for a better stability of money demand function and its equilibrium level of regulation is to engage in monetary policy research scholars and the monetary authorities face an important task. This article introduces a more systematic theory of money demand and money demand in domestic and international research literature, and on this basis to analyze the stability of China's money demand function as well as the demand for money affect the selection of the relevant economic variables.The construction of income, stock market, interest rates, expected rate of inflation and exchange rate variables in the demand for money from the econometric model, using co-integration test, error correction model and impulse response function to first quarter of 1994 to the second quarter of 2009 quarterly data for the sample, on China's money demand function, the equilibrium level of regulation the state of empirical research. Studies have shown that these variables exist with the real money demand for long-term stable equilibrium relationship between the demand for money in the short term memory to long-run equilibrium level of the spontaneous adjustment mechanism to adjust their respective variables affecting the demand for money in varying degrees and has a different dynamic process. According to empirical results,we made the policy recommendations.