本文使用1988年至1998年台灣的貨幣 (M2)與消費者物價指數之月資料，應用GARCH模型來產生貨幣波動的衡量且探討貨幣波動與通膨間的短期關係。實證結果發現：台灣的貨幣對通膨具有正向的影響，此外，從衝擊反應函數進一步的研究得知：貨幣波動的街擊對通膨有快速且劇烈的影響，其顯現穩定的貨幣政策將對經濟有所禆益，因為貨幣的波動性將會導致通貨膨脹且增加經濟的不穩定性。

The paper uses monthly data of money and consumer price index from January1988 to December 1998 for Taiwan. We use GARCH (1, 1) models to generate our measure of money volatility and then test the short-run dynamic relationship between money volatility and inflation. From our empirical results, we may reasonable conclude money volatility has significant, and positive effect on inflation. Furthermore, from the extensive study of impulse response functions, the results reveal that inflation reacts immediately and dramatically for monetary volatility shocks. It reveals that stable monetary policy will be better for economy, since uncertainty of money will cause inflation and fluctuation of economy.