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What is Understanding Monetary Policy Basics about?

Monetary policy uses a variety of tools to control interest rates and the money supply to influence economic outcomes like growth, inflation, exchange rates, and unemployment. Central banks have the ability to alter the money supply and influence interest rates. It is important for monetary policy to be credible, otherwise private actors may not believe the policy aims and it will be less effective at achieving its goals like stabilizing prices.

Author

Manu Sala

Language

EN