Question

What is meant by monetary policy?

Answer 1

Hyy dear
Definition: Monetary policy is the macroeconomic policy laid down by the central bank. It involves management of money supply and interest rate and is the demand side economic policyused by the government of a country to achieve macroeconomic objectives like inflation, consumption, growth and liquidity.
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Answer 2

Monetary policy is the actions and interactions of a central bank which controls the money supply.

• In order to create an economic growth, the monetary policy raises liquidity. To prevent inflation, it reduces volatility. Central banks use interest rates, specifications of bank reserves, and the amount of government debt that banks have to carry.
• It includes money supply and interest rate management and is the demand-side economic policy that a country's government uses to meet macroeconomic targets such as inflation, investment, productivity, and liquidity.
• Certain monetary policy goals include adding to gross domestic product growth, achieving and maintaining low inflation, and ensuring stable exchange rates with other currencies.