| Abstract | The existing researchs on China's monetary policy rules generally does not reflect the “multi-tool, multi-objective”reality of China's monetary policy.For this reason,this paper compares the five different instrument rules of monetary policy empirically based on a generalized forward-looking reaction function model using of China’s macro-data of 1994Q1-2011Q2. Each instrument rule use inflation gap,output gap, exchange rate gap and money supply gap as feedback variables,impliciting the four famous targeting rules. The empirical results show that the five rules reflect the situation largely that China's central bank controls the different objectives using different tools, but each rule are facing a dilemma of “trade-off”,and that the market interest rate rule is the best one in the five rules,but it is not stable inherently.Thus,in the“multi-tool, multi- objective” context,China’s central bank should not adopt a single monetary policy rules,but should do well the two coordination according to the economic situation and control goals. |