Is Monetary Policy Overburdened. 

The monetary policy, today, is not expected to achieve goals it used to achieve before. Unemployment and inflation are speculated to persist if overburdening of the monetary policy continues. Whenever the employment rates suddenly increase, the central bank is forced to print more money for salaries, but, this is not a solution to inflation.

During the crisis, central banks focused on price stability and at this time, they became independent institutions dominating the control of inflation without interference from the government. At that time, they achieved their goal in controlling inflation, but in 2008 and 2009, the inflation rate started increasing. The governments doubted on the credibility of central banks in maintaining price stability. Today, most central banks are not independent in their operations and that is why public policies from the government are overburdening the monetary policies. Price stability may not be realized if the public policies continue to overburden the monetary policies posing a threat to economies in the future (Orphanides 2013, p. 2).

Don't use plagiarized sources. Get Your Custom Essay on
Is Monetary Policy Overburdened. 
Just from $13/Page
Order Essay

The monetary policy is aimed at stabilizing the price levels of goods and commodities in accordance with the state of the economy. The global financial crisis incorporated inflation which led to a continued increase in unemployment rates. Governments rushed to reduce their spending and reduce unemployment rates that resulted in overburdening of the monetary policy. The monetary policy has been practiced before and deflation was achieved, and thus, stabilizing the price levels. Before the financial crisis, discussions on what constitutes a good monetary policy run among the major central banks where they agreed on the practice of targeting inflation (Orphanides 2013, p. 2).

At the first stages of the global financial crisis, disappointing growth was associated with many economies. The real GDP was maintained in countries like the US, the United Kingdom, and Japan.

Order your essay today and save 20% with the discount code: GREEN

Order a unique copy of this paper

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
Top Academic Writers Ready to Help
with Your Research Proposal
error: Content is protected !!
Live Chat+1(978) 822-0999EmailWhatsApp

Order your essay today and save 20% with the discount code GREEN