Monetary and fiscal policy: safeguarding stability and trust study notes cover the following learning objectives:
Compare and contrast the channels through which fiscal policy and monetary policy influence a country’s economic activity and financial markets, and define the “region of stability” in terms of their joint policy stances.
Describe the consequences of breaching the boundaries of the region of stability and how these consequences have evolved over time in advanced economies and in emerging market economies.
Describe the risks that global economies face as a result of high public debt levels, including the potential for these high debt levels, in combination with other factors, to drive tension between fiscal policy and monetary policy.