flowingss

[flowingss]

Monetary Policy: Definition, Types, Tools & Its Impact on the Economy

Monetary policy refers to the strategies and actions taken by a country's central bank to regulate the money supply, interest rates, and credit availability to achieve economic stability. It plays a crucial role in controlling inflation, boosting employment, and promoting economic growth. Central banks use tools like open market operations, reserve requirements, and policy rates to influence the economy. There are two main types of monetary policy: expansionary, which stimulates growth, and contractionary, which controls inflation. Understanding monetary policy helps businesses and individuals make informed financial decisions. Learn how it shapes economic conditions and impacts your daily life.