Macroeconomic Environment In The United States

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Paulo Marques Pinto
Economics for Global Business
Midterm Assessment
9 November 2015
Macroeconomic environment in the United States can be controlled through two major policies: the monetary policies and the fiscal policies. While the Federal Reserve has full control of the monetary policies, it plays no part in implementing fiscal policies; fiscal policies are normally determined by the Congress (Humpage, 2015, p. 3). The objectives of both the Federal Reserve and the Government of the United States are to achieve stable prices within the economy, stable economic growth, and full employment. It achieves these objectives by using certain appropriate macroeconomic policies. In the United States, the Congress has an established maximum price and employment rates that Federal Reserve should always strive to achieve. However, it should be affirmed that the Federal Reserve is an autonomous body that is separate from the federal government or the Congress. The macroeconomic policies involve the monetary policies that the United States government, through the Federal Reserve, have introduced to influence the availability of money and the cost of money and credit (Davig & Doh, 2014, p. 869). In most cases, the monetary policies include the statements, policies, actions, and directives that the Federal Reserve has used to influence the future perception of consumers. …show more content…
Through use of the forward guidance policies, the Federal Reserve hopes that it will make the rats of interests to remain low so that credit availability can be improved in order to stimulate growth in the American economy (Williamson, 2015, p. 21). The federal reserve have told the public what it intends to do and the conditions that will enable it to stay with the stated approach as well as the conditions that will make it change its course of

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