Monetary Expansion

Monetary expansion refers to the process where a country's central bank increases the money supply in the economy. This is typically done by lowering interest rates or purchasing assets like government bonds, making it easier and cheaper for businesses and individuals to borrow money. The goal is to stimulate economic activity, boost spending and investment, and prevent or recover from economic slowdown or recession. While it can encourage growth, excessive expansion may lead to inflation, where prices rise rapidly because of too much money circulating.