Monetary Policies

Monetary policy refers to the actions taken by a country's central bank to manage the money supply and interest rates to influence economic growth, inflation, and employment. In international economic contexts, it can affect currency value, trade balances, and global investment flows. By adjusting interest rates or buying/selling government securities, central banks aim to either stimulate the economy (by making borrowing cheaper) or cool it down (by raising rates to combat inflation). These policies are crucial for maintaining economic stability and fostering sustainable growth in a connected global economy.