Monetary Policy Transmission in the Era of High-tech Finance: New Channels and New Challenges

Abstract

This paper examines the transformation of the interest rate transmission mechanism under the conditions of rapid financial digitalization. The emergence of new financial intermediaries, decentralized finance (DeFi), digital lending platforms, and the growing role of big data and algorithmic pricing are reshaping how changes in the central bank policy rate affect the real economy. The research identifies novel transmission channels, including digital funding channels, crypto-asset price channels, and algorithmic expectation channels, while highlighting the risks of transmission fragmentation and uneven pass-through across sectors. The study concludes with policy recommendations for central banks to adapt their monetary policy strategies to the high-tech financial landscape.