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Open Market Operations: Monetary Policy

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Open Market Operations: Monetary Policy
Monetary Policy is the process used by the Federal Reserve to control the supply and availability of money. This is done through many different means in order to achieve various goals. Specifically, these goals include promoting maximum employment, stabilizing price fluctuations, and create a moderate, long-term interest rate.
One of the means used by the Federal Reserve is Open Market Operations. Open Market Operations (OMO) is when a central bank, like the Federal Reserve, buys or sells securities on the open market (Credit).
Another method used by the Federal reserve is called the Discount rate. The Discount Window functions as a safety valve in relieving pressures in reserve markets; extensions of credit can help relieve liquidity strains
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