Money market refers to the financial market of capital lending and short-term securities trading with a term of no more than one year, also known as "short-term financial market" or "short-term capital market", including interbank lending market, short-term bank deposit and loan market, bill market, short-term securities market, large negotiable certificates of deposit market and repurchase agreement market. Its participants are various government agencies, various bank and non-bank financial institutions and companies. The money market has four basic characteristics: ① the financing period is short, usually within one year, and the shortest is only half a day, which is mainly used to meet the needs of short-term capital turnover; (2) Strong liquidity, financial instruments can be cashed at any time in the market, and the trading objects are mainly credit instruments with short term, strong liquidity and low risk, such as bills and certificates of deposit. These instruments are highly liquid, similar to money, and can be called "quasi-money", so they are called money markets; (3) high security, because most transactions in the money market are spot transactions, that is, they are settled immediately after the transaction, and there is usually no phenomenon that the price fluctuates greatly due to the relatively long time between the transaction and the settlement date, which is a great guarantee for investors; Obviously, the money market is directly involved by the monetary authorities. It is the main channel for the central bank to contact commercial banks and other financial institutions, and it is the lever fulcrum for the state to use monetary policy tools to regulate national financial activities.

The transaction subject of money market is the supplier and demander of short-term funds. Demanders want to obtain realistic means of payment, adjust the liquidity of funds and maintain the necessary ability to pay, while the funds provided by suppliers are mostly short-term temporary idle funds. Money market can be divided into distribution market and transfer market. The former refers to the market where short-term credit instruments are put into circulation for the first time, while the latter refers to the market where short-term credit instruments are transferred.