China's Monetary Policy Intermediate Targets, Tools And Conduction Mechanism

As a main economic policy, monetary policy plays an important role in the adjustment of money supply and money demand, keeping the value of money stable, and accelerating the economic development. At present, however, the monetary policy system in our country is not consummate. Both the increment speed of money supply and the money fluid velocity are getting down. Therefore, how to find a better transaction mechanism of monetary policy that adapts economic development is the important and urgent question which we must take it into our consideration.This text is based on the reference theory of monetary policy in economics, and mainly focuses on analyzing the experience of monetary policy in China. We may find that there are some serious problems of the monetary policy of our country in the intermediate targets, policy tools, and transaction mechanisms. And then in order to promote the scientific carding and the validity of the monetary policy, this text has given some policy advice for the problem.The second part has demonstrated the literature on monetary policy and its intermediate targets. And it also has reviewed the history of the monetary intermediate targets in China and the focus of discussion at present. This part has compared all kinds of monetary intermediate targets what we chose to use for so many years, and to see which are better fitted for the situation of our country, and has made the visualize that interest rate will be instead of the money supply to be the monetary intermediate target of China.The third part has compared the difference of monetary policy tools in the western countries and china. And then we found some limitation in the choice of the monetary policy tools in our country. Based on the experience of the choice of the monetary policy tools in the west, the text suggests that China should develop and consummate the monetary policy tools that works as indirect control of monetary supply.The fourth part explores the transaction mechanism of monetary policy in China and the reasons for the counteraction of it. The fifth one just indicates what will it impact on the transaction mechanism of monetary policy and on the validity of the monetary policy for China's entering WTO. The section six is the suggestion of restructure of monetary policy tool and the way to get improvement of transaction mechanism of monetary policy, then a short conclusion.