A Study On The Effect And The Choice Of Chinese Monetary Policy Instruments

At present, Chinese monetary government mainly use deposit-reserve ratio, open market policy and interest rate policy as the tools of the financial market since1996, and these tools have been worked well as an indicator of monetary policy in the last ten years. This paper aims to analyze the three monetary policy tools’effectiveness, which means monetary policy tools can intrigue economic growth and confine the currency inflation.This paper is divided into six parts altogether. The first chapter introduces the background and literature review of monetary policy tools. The second chapter dedicates the main three policy tools in Chinese monetary policy, and then analyzes the practical implement of the tools and the problems existing now. In the third chapter, the paper uses empirical method to study the effectiveness of the three monetary policy tools and analyze the choice of the policy tools. The last chapter gives us the results and political suggestions of the whole research.