Friday, July 19, 2024

Monetary easing

In this article, We learn about “Monetary easing “.Let’s Go!

Monetary easing is a policy in which a central bank lowers interest rates and deposit ratios to make credit more available.

This makes it easier for businesses to borrow, thereby stimulating investment and business expansion.

Monetary easing is part of expansionary monetary policy.

The direct result of monetary easing is usually an increase in stock prices.

In the medium term, promote economic growth. However, if this policy continues for too long, it could result in too much money chasing too few goods and services, leading to inflation.

Therefore, most central banks will alternately implement monetary easing and monetary tightening policies to encourage economic growth while controlling inflation.

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