A Study On The Measure And Driving Factors Of The Global Liquidity

Since the crisis in 2008,most major economies have implemented quantitative easing monetary policy,injecting large amounts of liquidity into the financial market.The fed has carried out the quantitative easing monetary policy four times,the European central bank(ECB)releasing liquidity through bond purchased;After 2008,Britain implemented four rounds of quantitative easing,Japan’s mainly by lowering interest rates and asset purchases to realize quantitative easing.The quantitative easing of major economies make liquidity spillover effect obvious,and global liquidity present a trend of fluctuations.Accompanied by dramatic changes in global liquidity and,the price of commodity prices、crude oil、gold prices and the dollar index showed a sharp fluctuations.The volatility of the global liquidity influences asset price’s changes.As the fed’s quantitative easing out at present,the global liquidity easing is coming to an end.Under the influence of increasing the interest rates in us,the global total foreign exchange reserves begin to decline,especially the foreign exchange reserves in emerging market countries,and this trend will continue.The decline of global foreign exchange reserves means that capital abroad facing cash-strapped liquidity risks,which directly affect the asset prices of the foreign exchange reserves reduced,which will affect its economic development.The important role of global liquidity is obvious.In view of this,this paper puts forward a new measure method of global liquidity,understanding global liquidity characteristics to further explore the driving factors.The specific research framework of this paper is as follows:First of all,the paper expounds the connotation of the global liquidity,establishing a research perspective of this article.Liquidity here will be defined as macro analysis of global perspective.Analysis of the existing literature and characteristics of global liquidity shows that endogenous and periodicity of global liquidity is the main reason why it’s difficult to comprehensively measure global liquidity.Secondly,this article obtains from the perspective of debt,and puts forward a new global liquidity measure method,combined with the quantitative index and price index,to achieve better monitor changes of global liquidity.Global liquidity can be divided into core global liquidity and non-core global liquidity,highlighting the value of the collateral market.With the new global liquidity measure,it is concluded that the volatility of the global liquidity characteristics.Finally,based on the data from 2002 to 2015,using the enhancement factor of VAR model(FAVAR)model,we study empirically the driven factors of global liquidity.Results show that the essence driven of global liquidity is the global liquidity supply and demand.In the real economy,actual activity and financial stability significantly influence the dynamic changes of the global liquidity by influencing the core and non-core liquidity.To a certain extent,inflation driven fluctuations in global liquidity and the relationship between the two is not particularly evident.