The Correlational Study Of Interest Rate Cycle And Economic Cycle

The whole world financial crisis since2008has caused many National Co, banksof bankruptcy. Although China has taken strong measures to avoid this financial crisis,it still inevitably suffered some losses. China has tried frequently to adjust the bankinterest rate policy to support economic development during the past years, but inChina, the interest rate policy on economic development did not play a very goodeffect, so the effectiveness of interest rate policy study is very necessary. Researchabout the influence of interest rate policy comes more and more, while analysisperspective continuous diversification and related research results are very rich.In order to better explain the relationship between them from the qualitative andquantitative angle, on the basis of theory analysis between interest rate and economic,this article firstly discusses the mechanism that the interest rate fluctuations act oneconomic fluctuations. Next, the author divides the interest rate cycle and economiccycle of our country, drew the following conclusions: First, it’s found that both arebasically the same and wave cycle is anastomotic from the turning point of the cycletime and persistence length; Second, through the wave form, it can be found that theintensity of economic fluctuation and interest rate fluctuation are closely related, aswell as interest rate cycle and economic cycle period of expansion and contractionphase are basically the same; Third, through synchronicities inspection, we can seethat basic synchronization between the interest rate fluctuation and economicfluctuation, and it provides a direction for the following analysis.Then the author selects the1d Shibor、120d Shibor and the growth rate ofindustrial added value instead of GDP as indexes, established the VAR model, andanalyze the relationship between them according the result of the cointegrationtest,Granger causality test, impulse response and variance decomposition by the variables.The results show that, the Shibor and GDP is positively correlated; the bank interestrate volatility has been one of the significant influential factors of economicfluctuation, but the GDP doesn’t definitely increase when Loan amount increase,which requires us to formulate appropriate loan interest rate and improve the bankinterest rate policy. Finally, at the end of the article the artist prov ides somecorresponding policy suggestions: put forward that control of the bank interest rate inthe short term is the main means to prevent drastic fluctuations in the economy; advocated that we should improve the financial operation environment for long term,and a perfect bank rate policy system should be set up, so as to realize the sustainabledevelopment of the national economy.