Abstract: Under the condition of open economy, by constructing a TVP-VAR-SV model based on geopolitical risk, policy uncertainty and short-term international capital flows, the paper analyzes the time-varying influence of geopolitical risk and policy uncertainty on China′s short-term international capital flows after controlling macroeconomic and market factors.The results show that geopolitical risk and policy uncertainty have obvious time-varying negative short-term impact on short-term international capital flows, macroeconomic factors, Sino-U.S. interest margin and RMB appreciation expectation have basic impact on short-term international capital flows, and short-term international capital flows have significant positive self feedback effect.Based on the above conclusions, the geopolitical risk and policy uncertainty risk are included in the framework of macro prudential supervision, which is conducive to the short-term management of short-term international capital flows and prevent large fluctuations in short-term international capital flows.

Key words: geopolitical risk, policy uncertainty, short-term international capital flows, TVP-VAR-SV model