China's central bank drop must love to play "hide the cat cat"

Without a doubt, China's central bank to a victory over the financial market expectations; In a simple choice questions in front, the central bank will be duty-bound to choose to stand in the opposite of market expectations; And officials have declared expectations management conflicted with the fundamental key, the central bank of choice over market strategy to bring market expectations of disorder,cheap new era hats and disorder can lead to turmoil in financial markets. February third Saturday night at eight, the central bank to calm water fling out in a heavy stones, rippling water waves. The deposit reserve rate 50 basis points cut selection in such a date announced that really unexpected, although money market funds in the last few trading day last week is very nervous, but the central bank has inverse repurchase operation, so traders to short drop must expected dissipation, ease at home for the weekend. Save the accuracy of 50 basis points cut, no doubt, can let traders collective cheering, after all, not to go for the positions matching reggie capital; But the excitement I, traders can't help again how much some sad choke, the central bank baton was really hard to see the direction. The central bank reserve rate adjustment to some degree on top of the expression is more policy presetters fine-tune the rapid response, also accord with the fundamental key policy since the beginning. In a week ago, by the central bank in the fourth quarter of 2011 monetary policy implementation report declared in 2012,best sunglasses the money supply growth was 14%, the implicit of new size of credit in 2012 in 8.5 trillion. And credit on the dependent on bank capital the better. Traders may argue that the central bank adjust the deposit reserve rate because the soaring cost of capital Friday sparked concern, in most cases, this belongs to the romantic. In the financial markets, money market interest rates have not one of the goals of the central bank to control; Before the Spring Festival double-digit funds rate, the central bank still rank diaoyutai, that is, put down the accuracy, when the market research and investment manager macro experts are predicting, central bank before the Spring Festival, the deposit reserve rate cut at least 50 basis points, but the result is the central bank let financial market disappointed to spend the Spring Festival, consistent expected effect. After the Spring Festival, in two inverse phase buyback expires, the money did not worse, market to the deposit reserve rate cut expected gradually delay; Although last Thursday and Friday capital prices began to nervous, but last Friday there was more central bank news of the buyback inverse again, financial markets to the deposit reserve rate cut expectations continue to delay, investors argue that the central bank will normal operation of inverse repurchase, corresponding reserve rate cut down in the necessity of the system; But, the market is expected to again wrong, the central bank announced on Saturday night at eight cut reserve rate; The central bank is expected to win over the market, easy. The central bank has been expected to emphasize the need for management, expected the significance of the management to lower the policy intervention is small the cost, to the financial control concept is deep the dividing line between the monetary policy is to understand the rules of the great differences. At present the western economies in monetary policy should be emphasized on rules transparent and independence, the purpose of which is expected to strengthen management. As the federal reserve Ben bernanke dominated by a transparent system design, the default rules in of market expectations for guidance and management, monetary policy in a transparent manner trend to understand the market, so as to make policy in a way can be predicted the market, in order to avoid abrupt policy that the impact on the market. In addition, the bank of England and the European central bank also have set up a set of rules for the monetary policy system; These rules including the established the arrangements for the meeting, then the disclosure meeting minutes, news conference, policy objectives and stable, independent monetary policy rules; The fed and the practice of western central bank for these institutional arrangements, for the central bank set up a high reputation in the market and influence, obtained the good policy effect, also for market institutions are more likely to accept. London school of economics professor Charles eidur gudjohnsen hart (CharlesGoodhart) used expected socialist (expectationlists) to conclude the monetary policy practice and the traditional, in these scholars and policy practitioners, it seems, the core of the monetary policy, is the management and guide in the economy expected; And the central bank monetary policy transmission of information, than policy tools itself is more important. Although domestic monetary policy authorities have been stressed the need to improve the monetary policy independence and transparency, but at least from recently's practice, the central bank often inverse expected and move, and financial market playing "hide the cat cat" game, cause you financial markets. Market participants on long-term monetary policy lack of expected, which in turn leads to investment, financial market liquidity lot disorder, efficiency decreases, financing function attenuation. The description of the profiling might not dramatic, but just look at money market traders this more than a year for capital positions rolling sent special anxiety out of eyes and state, all but at not did. In fact to tell the truth, traders don't like to play "hide the cat cat," especially and central bank.

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