Monetary policy

Monetary policy is the policy used by the monetary authority of a country that controls either the interest rate that can be paid on very short-term borrowing or the money supply. They often target inflation or the interest rate to help make price stability and general trust in the currency.^[1][2][3]

Other goals of a monetary policy are usually to help make the gross domestic product more stable, to get and keep low unemployment, and to have predictable exchange rates with other currencies.

1. ↑ Jahan, Sarwat. "Inflation Targeting: Holding the Line". International Monetary Funds, Finance & Development. Retrieved 28 December 2014.
2. ↑ "Monetary Policy". Federal Reserve Board. January 3, 2006.
3. ↑ Levy Yeyati, Eduardo; Sturzenegger, Federico (2010). "Monetary and Exchange Rate Policies". Handbooks in Economics. Handbook of Development Economics. Vol. 5. pp. 4215–4281. doi:10.1016/B978-0-444-52944-2.00002-1. ISBN 9780444529442.