_Monetary Policy
Monetary Policy is changes in the Money Supply in order to achieve particular macroeconomic goals. Can be either expansionary (stimulating the economy) or contractionary (slowing the economy).
This article is an example of contractionary policy
http://www.nytimes.com/2011/07/07/business/global/07yuan.html
In the article China Raises Interest Rates it states that China is raising interest rates for the 5th time in nine months to help slow economic growth and price increases. Banks are cutting back on lending loans and raising key lending and deposit rates to help slow inflation. Inflation is expected to remain elevated. Unemployment rate might grow. Consumer prices are raising again. The economic growth may slow due to the bank restrictions for new loans
The graph below is an example of this contractionary policy.
Monetary Policy is changes in the Money Supply in order to achieve particular macroeconomic goals. Can be either expansionary (stimulating the economy) or contractionary (slowing the economy).
This article is an example of contractionary policy
http://www.nytimes.com/2011/07/07/business/global/07yuan.html
In the article China Raises Interest Rates it states that China is raising interest rates for the 5th time in nine months to help slow economic growth and price increases. Banks are cutting back on lending loans and raising key lending and deposit rates to help slow inflation. Inflation is expected to remain elevated. Unemployment rate might grow. Consumer prices are raising again. The economic growth may slow due to the bank restrictions for new loans
The graph below is an example of this contractionary policy.