Monetary Policy and Fiscal Policy

Monetary policy and fiscal policy are two different tools that have an impact on the economic activity of a country.

Monetary policies are formed and managed by the central banks of a country and such a policy is concerned with the management of money supply and interest rates in an economy.

Fiscal policy is related to the way a government is managing the aspects of spending and taxation. It is the government’s way of stabilising the economy and helping in the growth of the economy.

Governments can modify the fiscal policy by bringing in measures and changes in tax rates to control the fiscal deficit of the economy.

MonetaryPolicyFiscal