Abstract: Clarifying the impact of the information effect of monetary policy is crucial to improving the effectiveness of monetary policy. This paper constructs a DSGE model incorporating credit inertia and the information effect of monetary policy, theoretically reveals the moderating role of long-term bank-firm credit relationships on the information effect of monetary policy, and conducts an empirical test using bank credit line data of Chinese listed enterprises. The results show that a positive information effect of monetary policy promotes the growth of corporate credit; bank-firm credit inertia restrains this effect and exerts a negative moderating effect. Heterogeneity analysis indicates that such restraining effect is more pronounced among smaller banks with weaker risk-bearing capacity, as well as among private enterprises and enterprises with lower financing constraints. The conclusions of this paper provide theoretical support and empirical evidence for further enhancing the effectiveness of monetary policy.

Key words: bank-firm relationships, information effect, factor model, DSGE