Abstract: We find that the price in China’s economy is symmetric and has conditional heteroscedasticity in the period of expansion and recession.Main factor causing price variable comes from consumption demand.Tight monetary policy could curb inflation,but robust monetary policy has little influence on deflation.Easy fiscal policy does not Granger cause price level.So,we need more active nominal expansions to loose the pressure of deflation.

Key words: symmetry, inflation, deflation, economic policy