An Analysis on the Influence of Financial Innovation on Monetary Policy

Financial innovation is the primary way to financial structure promotion and important force for financial development,mainly embodied by financial instrument innovation,financial institution innovation and financial system innovation.In such financial fields as banking system,securities market,foreign exchange market and financial derivative market,etc.organizational models and function value of relevant financial entities have changed,the activities of financial innovation have some influence on monetary policy with different means and ways.This has resulted in a more diversified and more complex economic and financial environment,which is depended by money operation,and meanwhile the effectiveness of monetary policy is facing challenge.In order to exert the positive role of financial innovation on monetary policy into great play,it's necessary to rationally develop financial innovation,quickening the central bank monetary policy regulating system reform with other supplementary macro economic policies to be made.