Rising interest rates in China lead to economic structure improvement.
The rise in nominal deposit interest rates in China can help improve the economy's structure and promote sustainable development. By using a specific model, researchers found that higher interest rates can reduce investment growth, increase the proportion of consumption in the economy, and make monetary policy more effective. Contrary to fears, the model suggests that rising interest rates do not harm the economy. The study suggests that continuing with interest rate reforms is important for the future.