Abstract

Monetary policy adjustment and macro-economy stability analysis based on new-Keynesianism monopolistic competition model

Author(s): Fan Wang, Mingyu Yu

Monetary policy adjustment is functioning as a positive driving force for the stable development of our national macro economy. Currency market development has gone through 3 stages, the dual economy system to unification of exchange rates then to exploration of constructing rmb exchange rate management mechanism, which all had positive effects on the promulgation of our country’s monetary policies. However, the reformation on foreign exchange management system,which has gradually stifled the initiative of monetary policies, is correspondingly playing an obstructive role in the fast development of our country’s financial market. Thus, it is significant to do a test on the stability of currency market data. And this paper will produce a more convincing analysis process by means of the casual relationship study on the transition mechanism between different monetary interest rate systems and constructing the mathematical model of the short-term or long-term targets of policy tools.