Author(s): Nyerhovwo Prince
Monetary policy is an important tool used by central banks to influence economic performance by controlling the money supply, interest rates, and exchange rates. This paper examines the effectiveness of monetary policy in achieving macroeconomic objectives such as economic growth, full employment, and price stability, and the limitations that can affect its effectiveness. While monetary policy has been successful in stabilizing the economy during crises, its effectiveness is subject to several limitations such as the timing and magnitude of its impact, the state of the economy, and the presence of other economic shocks. This study highlights the need for central banks to consider these limitations when implementing monetary policy to achieve their macroeconomic objectives.