Monetary policy By Kamilla Baizhanova Monetary policy

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Monetary policy By Kamilla Baizhanova Monetary policy By Kamilla Baizhanova

Monetary policy is one of the tools that governments use to control the economy.Monetary policy is one of the tools that governments use to control the economy. Monetary policy involves: making changes to the interest rate changing the amount of money circulating round the economy

How does it work? 1. Commercial banks borrow their money from the Central BankHow does it work? 1. Commercial banks borrow their money from the Central Bank 2. The interest rate of the Central Bank influences the rates commercial banks set for their customers 3. Interest rates go up and borrowing money becomes more expensive / when they go down, it becomes cheaper

Main vocabulary Mortgage - the biggest loans taking out to buy houses Buying inMain vocabulary Mortgage — the biggest loans taking out to buy houses Buying in credit – to buy things using borrowed money. Interest rate has a big impact on: — consumer spending — companies Export sales exchaning rate Economy as a whole

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