Accommodative Monetary Policy

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When a central bank (such as the Federal Reserve) attempts to expand the overall money supply to boost the economy when growth is slowing (as measured by GDP). This is done to encourage more spending from consumers and businesses by making money less expensive to borrow by lowering the interest rate. Furthermore, the Federal Reserve also has the authority to purchase Treasuries on the open market to infuse capital into a weakening economy.

[Source: http://www.investopedia.com/terms/a/accomodativemonetarypolicy.asp]

Sayed Farrukh Ahmed
Assistant Professor
Faculty of Business & Economics
Daffodil International University