Abstract: Under the framework of non-linear and time-varying analysis,we investigate the macro-performance of monetary targeting paradigm of China’s monetary policy.Our econometric test shows that in recent years the macro-effect of monetary targeting is significantly weakening,its uncertainty is increasing and its efficiency is diminishing.At the same time,the efficiency of interest targeting is improving.So in the new market economy circumstances,we should use interest signal to monitor and guide the operation of macro economy,which is more flexible,less costly and contains more information.Also,the single intermediate target should be chosen.

Key words: MS-SVAR, monetary targeting, interest targeting, multiple intermediate targets