What is an Accommodative Monetary Policy?
As a way of helping to stimulate the economy, the use of an accommodative monetary policy is often one means of helping to improve the financial situation within a given geographic region or throughout a country. Here is some information about the nature of an accommodative monetary policy, plus a couple of examples of when such a policy can be beneficial to the economic health of a region or country. An accommodative monetary policy is a procedure or policy that is set forth by a central bank within a given country. Essentially, the purpose of the policy is to stimulate growth within a sluggish economy that is posting little or no growth at all. This usually involves making a temporary change in the short term interest rates on all sorts of loans, from personal to business loans. The accommodative monetary policy is invoked in the hope that the lower interest rates will attract the attention of the general public as well as business leaders and create more desire to borrow money from
