Cao Yuanzheng: China’s monetary policy is in a normal space

Cao Yuanzheng: China’s monetary policy is in a normal space
On May 22, Sauna Night held two sessions of economic strategies, invited economists to be a guest in the live room of Sauna Night, Peng Sen, former deputy director of the National Development and Reform Commission, former director of the Institute of Finance of the Ministry of Finance, and Jia Kang, director of the China Academy of New Supply Economics,Liu Yuanchun, vice president of Renmin University of China, and Cao Yuanzheng, chairman of BOC International Research Co., Ltd., etc., jointly interpreted the government work report released this morning.The government work reports of the two sessions this year put forward that the proactive fiscal policy is more active and prosperous, and the stable monetary policy is more flexible and appropriate. Cao Yuanzheng believes that this constitutes the basic tone of China ‘s fiscal and monetary policies.Differently, from the perspective of monetary policy, China’s monetary policy is in a normal space, “specifically, the market interest rate is positive, and the policy interest rate is also positive, which is significantly higher than the inflation rate; while in European and American countries, the interest rate has already shown 0, evenIs a negative interest rate. “Obviously, Cao Yuanzheng said, “The economy is down and fiscal revenue is falling. To fight the epidemic, fiscal expenditures rise and it is normal for fiscal deficits to appear. China has also raised the deficit rate to 3.Above 6%, we expect to increase to 3.Around 8%, then another question arises, who pays for the deficit?”Cao Yuanzheng said,” In fact, it is very simple, there is no way in the West. In the case of the impact of the epidemic, deleveraging, and a relatively low savings rate, the national debt is difficult to sell., Open the printing press, support fiscal expenditures, and support fiscal deficits.In China, the situation is exactly the opposite. The savings rate of residents is relatively high. The growth rate of residents ‘savings in the first quarter of this year is obvious.Cao Yuanzheng believes that this has also brought new discussions on how to coordinate monetary policy in the face of new economic prospects.”Although we have been talking about cooperation in the past, we actually have independent operations. The reason is that if there is no bottom line to overdraw the central bank, it will definitely cause inflation. This is a precedent in history.Therefore, governments of all countries also strictly adhere to a certain bottom line, that is, finances cannot overdraft the central bank without a bottom line, but only by conventional restrictions that cannot be overdrawn. Therefore, the inflation rate plus the actual growth of GDP calculates the basic scale of the money supply. “,Cao Yuanzheng pointed out that the bottom line of the Western countries ‘breakthrough conventions will be what the future results will be. It is difficult to predict,“ In our opinion, it is a drinking thirst to quench thirst and how to detoxify after drinking poison.Never come to this situation. “Cao Yuanzheng paid special attention to the two mentioned in the government work report. One is that the money supply guides the broad money supply and the scale of the growth of social financing stocks has significantly increased over last year.Cao Yuanzheng explained that the reason behind this is very simple. Finance is procyclical. When the economic downturn accelerates, countercyclical adjustments must be made. This is a requirement of great financial resources.In fact, it is necessary to increase the scale of social financing in a counter-cyclical way to withstand the procyclical phenomenon.In fact, during the economic downturn, liquidity is tight, and it is difficult to maintain the debt chain. Only by supplementing liquidity can the stability of the bond debt chain be maintained.According to Cao Yuanzheng, the Fed ‘s one-time bond interest rate of zero, and the fundamental bottom line of acquiring corporate bonds is itself a method of replenishing liquidity. These are reflected in the special period, the supplement of liquidity is particularly important.Another article is that in the government work report, “innovating monetary policy tools that directly reach the real economy”, Cao Yuanzheng said, “I think this is a major formulation. How to do it is now being explored.After the financial crisis, countries are innovating monetary policy tools that directly reach the real economy. Some Americans directly provide loans to enterprises, and multinational banks directly finance on bills.At the same time, it is also possible to consider issuing special national bonds and organizing industrial funds to provide capital supplements to difficult enterprises. This practice has appeared in the reform of China’s banking industry in 2004. “”All in all, there should be a lot of innovation in this area, and we are also very concerned about this, especially to promote enterprises to facilitate access to loans and push interest rates to continue to fall.”There will be certain arrangements in monetary policy, and this discussion may continue,” Cao Yuanzheng said.Sauna, Ye Wang Zhang Siyuan Editor Chen Lixiao dealt with Chun Leng

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