Optimal Monetary Policy

Optimal monetary policy is the strategy used by a central bank to manage the economy's growth, inflation, and employment levels effectively. It involves adjusting interest rates and other tools to stabilize prices, promote full employment, and support sustained economic growth without causing excessive inflation or recession. The goal is to find a balance that maximizes economic stability and improves living standards over time. In essence, it's about using informed, timely actions to keep the economy functioning smoothly and predictably.