Flashcards: Mastering Central Bank and Monetary Policy — 10 cards

Central Bank Functions — key roles?

Issuing currency, implementing policy, regulating banks.

Central Bank — functions?

Issue currency, manage money supply, regulate banks.

Monetary Policy Objectives — main goal?

Maintain price stability and support employment.

Interest Rate Tools — purpose?

Influence economic activity and inflation.

Interest Rate Tools — primary method?

Adjusting policy rates and open market operations.

Open Market Operations — definition?

Buying/selling government securities to control money supply.

Reserve Requirements — role?

Set minimum reserves banks must hold.

Quantitative Easing — effect?

Increase money supply, lower interest rates.

Inflation Targeting — goal?

Maintain inflation around 2%.

Transmission Mechanism — function?

Channels through which policies affect the economy.