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However the inflation rate looked good and was not increasing at an uncontrollable rate.Here is an essay on the ‘Monetary Policy’ for class 11 and 12.
Monetary Policy I chose to research and write on the topic of monetary policy. From my research I would define monetary policy as the macroeconomic act of keeping the country financially stable.
According to object of monetary policy is to influence the performance of the economy as reflected in such factors as inflation, economic output, and employment.
This tool is not used very often, when it is it usually signals a major shift in the direction of monetary policy.
According to the information I obtained from the most recent report online from the Federal Reserve was dated July 18 2001.
In the subsequent years the bank’s sale of government securities exceeded its purchases.
But this excess sales method was discontinued between 19 with a view to expand currency and credit in the economy. Liberalisation of the Bill Market Scheme: The Reserve Bank has liberalised the bill market Scheme, as a result, the commercial banks receive additional funds from the Reserve Bank to meet the credit requirements of the borrowers.
Every economy faces two conflicting interests: (a) Expansion of money supply to finance the process of economic development.
(b) Control of money supply to check inflationary pressure generated in the economy as a result of vast developmental and non-developmental expenditure.
Consumer and business confidence was down which meant that people and businesses within our economy were not spending as much money as usual.
The stock market also showed a dramatic drop which is not good for our economy.