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Business
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The ultimate risk of slowing inflation is that it may cause a recession. Slowing inflation also causes unemployment to rise, GDP and interest rates to drop proportionally to inflation, and the reserve ratio to increase. The increase in reserve ratio will cause less return for lenders.
To mitigate these risks, interest rates must decrease in order to stimulate investment and for consumers to put their money in the market...
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The ultimate risk of slowing inflation is that it may cause a recession. Slowing inflation also causes unemployment to rise, GDP and interest rates to drop proportionally to inflation, and the reserve ratio to increase. The increase in reserve ratio will cause less return for lenders.
To mitigate these risks, interest rates must decrease in order to stimulate investment and for consumers to put their money in the market...
Essay fragment
General points of the essay
monetary policy and inflation
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