Currency Scissors,Interest Rates And Housing Prices In China

There are lots of relationships between the scissors differential of money and the economic phenomena in our country.And the price of the real estate has been rising these years.In the past lots of scholars have studied the two phenomena.But the study of the scissors differential of money are mainly concentrated in the contact between this variate and the macro economic trends to explore if this variate can predict the economic trends.In addition,some people have researched the reasons for the high monetary scissors one of which is the real estate market’s boom and the rising house prices.The research on real estate prices in China mainly focuses on the money supply,interest rate and policy to explore the reasons and effects of high real estate prices.Few scholars have explored the connection between the two variates.From the perspective of structure,the continuous increase of the real estate’s price can explain the enlargement of the monetary scissors.And the expansion of the scissors differential of money will influence the real estate prices to a certain extent.Besides,the variable of interest rate is introduced in this paper to establish a stable VAR model of these three variables to illustrate the relationship among the three variables and give corresponding policy suggestions.This paper mainly uses the method of theoretical analysis and empirical analysis to explore the variation rule of money growth rate scissors,interest rate,property price fluctuation and the correlation among them.From the perspective of reason analysis,this paper will explore whether the variation of interest rates is the reason of the change of scissors differential of money and the growth rate of house prices.We will also explore whether changes in house prices will influence the monetary scissors and the pathway of influence between them.The main content of this article includes the following parts:The first part is introduction.On the topic of monetary scissors,interest rate and real estate price fluctuations,this part states the background and the theoretical and realistic significance of this article.And it summarizes the researches of predecessors on the issue.Finally it illustrates the innovation and the deficiencies of this article.The second part is the theoretical analysis of the correlation of the currency scissors,interest rate and the growth of real estate prices.Because the changes in the money supply is the foundation to formulate the scissors differential of money,this part will firstly analyze the relationship between the money supply,interest rates and real estate prices in brief and lay a theoretical foundation for subsequent analysis.Then from the perspective of economic theory,it analyzes the relationship of money scissors,interest rate and the growth of the real estate prices.On this basis,it explores the possible relationship between the three variables from the perspective of monetary structure.The third part is the basic characteristics of the rate of the money scissors,interest rate and the growth price.We selected and processed the data and analyzed the time sequence diagram of variable data,and explored the trend of three variables over time and possible relevance among them.The fourth part is the empirical analysis of the relationship among the money scissors,interest rate and the growth price.This part contains data stationarity test,cointegration analysis and granger causality test,and finally establishes the VAR model on the basis of which I conduct the impulse response analysis.The empirical results proved that the fluctuation of interest rate is the reason of the changes of money scissors and real estate prices.And the real estate price growth will cause the expansion of the scissors.There is also an interactive relationship between them.The fifth part is the conclusion and policy recommendations.Through the above theoretical and empirical analysis,I conclude that the fluctuation of interest rate is the reason of the changes of money scissors and real estate prices.At the same time,I conclude that the change of the estate price is a reason of the fluctuation of the money scissors.This part analyses the specific ways of interactive influence among the variables,and confirms that expands of China’s monetary scissors is mainly due to imbalance in the structure of money supply which is caused by the rising interest rates and property prices.Based on the above analysis and conclusion,this section puts forward the following suggestions.Firstly,use monetary policy skillfully to reduce the money scissors.Secondly,strengthen the flexibility of interest rate adjustment and design real estate market products according to interest rate.Finally,adjust the operation’mechanism of the real estate market to curb the widening of the scissors differential of money.