The Monetary Policy Of The United States Central Bank

863 WordsJul 19, 20154 Pages
The monetary policy is among the most crucial tools the United States central bank can put into use so as to achieve the various economic objectives. The outlook of the US economy should underline the progress that the Fed reserve has initiated towards the mentioned dual mandate which has been put into place by the Fed reserve towards the constant dual mandate goals of employment to the maximum in the price stability context (Steven, 2011). Over the recent times or years, the US economy has progressed towards the outlined goals. However, in the context of the United States monetary policy, the rate of unemployment is still at high levels while the rate of inflation is too low. Due to the uncertainty of the US monetary policy, normalization can be determined since it is data dependent (Axilrod, 2011). Whenever there is a shift in monetary policy, it is crucial to be mindful of the most likely occurrences since they come alongside by certain degrees of market turbulence and stress. Additionally, if the US monetary policy is normalized, some certain challenges will be formed for the economies in the emerging markets (Steven, 2011). It is upon the Federal Reserve therefore to address the risks that come with the US monetary policies. There are therefore key factors that have an influence on the amount of money that people hold desirably. One of them is consumer spending which is related directly to the demand of goods and services. During the periods whereby customers spend a
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