Osteopathic Healing Hands

An Important Tool With Which A Central Bank Can Affect The Monetary Base Is Open Market Operations If Its Country Has A Well Developed Market For Its Government Bonds This Entails Managing The Quantity Of Money In Circulation Through The Buying And Selling Of Various Financial Instruments Such As Treasury Bills Company Bonds Or Foreign Currencies In Exchange For Money On Deposit At The Central Bank Those Deposits Are Convertible To Currency So All Of These Purchases Or Sales Result In More Or Less Base Currency Entering Or Leaving Market Circulation For Example If The Central Bank Wishes To Lower Interest Rates (executing Expansionary Monetary Policy) It Purchases Government Debt Thereby Increasing The Amount Of Cash In Circulation Or Crediting Banks' Reserve Accounts Commercial Banks Then Have More Money To Lend So They Reduce Lending Rates Making Loans Less Expensive Cheaper Credit Card Interest Rates Boost Consumer Spending Additionally When Business Loans Are More Affordable Companies Can Expand To Keep Up With Consumer Demand They Ultimately Hire More Workers Whose Incomes Rise Which In Its Turn Also Increases The Demand This Tool Is Usually Enough To Stimulate Demand And Drive Economic Growth To A Healthy Rate Usually The Short-term Goal Of Open Market Operations Is To Achieve A Specific Short-term Interest Rate Target In Other Instances Monetary Policy Might Instead Entail The Targeting Of A Specific Exchange Rate Relative To Some Foreign Currency Or Else Relative To Gold For Example In The Case Of The United States The Federal Reserve Targets The Federal Funds Rate The Rate At Which Member Banks Lend To One Another Overnight; However The Monetary Policy Of China Is[when?] To Target The Exchange Rate Between The Chinese Renminbi And A Basket Of Foreign Currencies