Template-Type: ReDIF-Paper 1.0
Author-Name: Daniel Rees
Author-X-Name-First: Daniel
Author-X-Name-Last: Rees
Author-Name: Guofeng Sun
Author-X-Name-First: Guofeng
Author-X-Name-Last: Sun
Title: The natural interest rate in China
Abstract: We estimate the natural interest rate in China. The natural interest rate averaged between 3 and 5 per cent between the late 1990s and 2010, but declined over the next decade to around 2 per cent. We attribute around two-thirds of the decline in China's natural interest rate to a lower rate of potential output growth. As the decline in the natural interest rate in China mirrors that observed in many other economies, it is possible that global factors explain part of the decline in the natural rate not explained by lower growth.
Length: 29 pages
Creation-Date: 2021-06
File-URL: https://www.bis.org/publ/work949.pdf
File-Format: Application/pdf
File-Function: Full PDF document
File-URL: https://www.bis.org/publ/work949.htm
File-Format: text/html
Number: 949
Keywords: real interest rate, natural interest rate, monetary policy
Classification-JEL: E32, E40, E44
Handle: RePEc:bis:biswps:949