Research On Influence On The Effect Of Monetary Policy From State Treasury Funds Volatility Of China

There are many factors that can influence the effect of monetary policy, central bank’s assets and liabilities structure is one of the important aspects. Government is always important in central bank balance sheet structure, whether the central bank creditor’s rights to the government or government’s deposits at the central bank, will affect the bank’s assets and liabilities structure to some degree. Our country adopts a principal-agent system of national Treasury, central bank plays an agency part of the treasury function, so the state treasury funds of our country is the government’s savings in the central bank. Since China implemented reform in 1994, the national finance income of GDP rose sharply, the major increase of state treasury funds has created a lot of idle treasury funds, which seriously influence the efficiency of funds and the economic life. Management and use of the treasury funds has a deep relationship with treasury management, money supply and the coordination between fiscal policy and monetary policy and other aspects, and has become an important part of government work. Therefore, to analyze the influence on the effect of monetary policy from fluctuation of treasury funds has great theoretical significance and practical significance.In this paper, by combining qualitative analysis with quantitative analysis, we analyze influence on effect of monetary policy from the fluctuation of treasury funds. First of all, define the related concepts of state treasury funds and evaluation system of monetary policy, and then make qualitative analysis on the state treasury funds fluctuation’s effect on monetary policy operation indicators, intermediate targets, and the effects of the transmission mechanism. Next analysis and summarise existing treasury cash management system and its function, and the evolution of abroad state treasury cash management system. Then summarize experiences of abroad treasury cash management. On this basis, analysis evolution of state treasury cash management system in China as well as their volatility of treasury funds in recent years. Our country’s treasury funds balance shows the characteristics of relatively obvious cyclical changes, cyclical period is a year, our country’s financial system and the financial environment has much to do with the fluctuations. At present the state treasury cash management’s biggest problem of our country is that there are still large idle funds, imperfect money market makes capital efficiency low, and a reasonable level of state treasury funds is still not sure. In empirical part, we analyze the effect of fluctuations in the state treasury funds from the operation target of monetary policy, to make results more comprehensive. And this paper selects month data of state treasury funds, monetary base, inter-bank lending market interest rate, money supply, financial institutions reserve and financial institutions credits, to make empirical analysis on the state treasury funds fluctuation’s influence on operation target, intermediary target and monetary policy transmission mechanism. First of all, cointegration test show there is a long-term equilibrium relationship between these variables. Then we ues the granger causality test which based on correction model to determine the causal relationship between these variables. Finally we use impulse response to make specific analysis of the state treasury funds’direction influence on the above variables, and use variance decomposition to analyze the concrete influence degree.Finally we conclude that the volatility of state treasury funds will affect our country’s monetary policy operation indicators, as well as intermediate targets, and interfere with the monetary policy transmission mechanism, eventually impact monetary policy effect. At the end of the article we give some relevant policy suggestions based on the empirical results and the problems in treasury management of China.