Author(s)

Jingyao Zheng, Qiaoyu Liu, Jinyi Liu, Zijun Zhou

Corresponding Author

Jingyao Zheng

ABSTRACT

China's interest rate liberalization is conducive to promoting the fundamental transformation of the operation mechanism of state-owned banks and carrying out commercial and enterprise management. At the same time, the integration of interest rates has improved the micro transmission mechanism of monetary policies, enabling financial institutions to control certain floating rights of deposit interest rates, reduce their dependence on national benchmark interest rates, and have the ability to set their own prices. Moreover, further promoting the marketization of deposit and loan interest rates and improving the assets and liabilities capacity of commercial banks can also bring higher stability to China's financial market. In addition, encouraging the innovation of financial products can provide higher flexibility to the interest rate market and promote the process of interest rate liberalization in China.

KEYWORDS

Interest rate Liberalization Reform, Commercial banks, LPR reform, Dual interest rate system