The Choice of China Benchmark Interest Rate

摘要

As the liberalization of commodity market and the development of finance market, interest rate marketization is heavily required. While in the process of interest rate marketization, the choice of benchmark interest rate is the primary issue. Though analyzing foreign choices of benchmark interest rate and summarizing the latest civil researches on the choice of benchmark interest rate, this paper concludes the standards of choice of benchmark interest rate. According to these standards, firstly this paper gives preliminary analysis of all kinds of money market interest rate which helps to choose out the candidates that have possibility to be the benchmark interest rate. Then this paper gives a further analysis on the chose candidates using Granger method and VAR method, and finds that the interbank repo interest rate is the most suitable one to be the money market benchmark interest rate at present. Finally, this paper makes further discussion on improving interbank repo market.