Banking and Monetary Economics

Banking and monetary economics study how banks and financial systems manage money and credit to support economic growth. Banks accept deposits, provide loans, and facilitate transactions, while central banks regulate the money supply to control inflation and stabilize the economy. Interest rates influence borrowing and spending, impacting overall economic activity. Monetary policy, enacted by central banks, uses tools like interest rate adjustments and open market operations to guide the economy. Understanding these concepts helps explain the interconnectedness of finance, economic health, and policy decisions that affect everyday life.