Research On The Fluctuation Of Asset Price And The Effectiveness Of Monetary Policy

Since July 21, 2005, China adopted a "managed floating exchange rate mechanism",The international and domestic markets is widespread expectations that the RMB may be appreciating. Since then, the expected appreciation of the RMB is to be an important variable to affect economic equilibrium, and it is a decisive variable. The exogenous variables is decided by the international and domestic market participants. It is difficult to to measure the impact of the economic.So, when the whole economic system adding this variable, We must doubt that whether the central bank's monetary policy concerns on the fluctuation of asset prices as effectively as before?In this article, The author will re-examine the fluctuation of asset price and the effectiveness of monetary policy in the context of the expected appreciation of the RMB. This analysis is always from the perspective of the expected appreciation of the RMB.First, The author analysis the fluctuation of asset price and the effectiveness of monetary policy in the context of the expected appreciation of the RMB from the theoretical. Second, The author analysis the fluctuation of asset price and the effectiveness of monetary policy in the context of the fixed exchange rate mechanism form the positive. Finally, The author recommend some suggestions that how to improve the effectiveness of monetary policy in the context of the expected appreciation of the RMB.