Raising the discount rate is not, yes.
The discount rate is one of the important means to realize the central bank, and it is a special form of the central bank to provide loans to commercial banks.
By changing banks’ rediscount bills to the central bank, the cost of refinancing can be obtained, thereby reducing banks’ reserves at the central bank and forcing banks to slow down lending.
So if there’s less money in the society, and there’s no change in demand, then money will go up.
1. Contractionary monetary policy: It is a means adopted by the central bank to regulate and control the macro-economy. By reducing the money supply, the interest rate will rise, making it more difficult to borrow goods, thereby reducing investment and reducing demand.
Let aggregate demand go down and aggregate supply come into balance;
2. Expansionary market policy: It is a means adopted by the central bank to regulate the macro-economy. By increasing supply, interest rates will fall, making it easier to borrow goods, thereby increasing investment and expanding demand.
Let aggregate demand go up and aggregate supply come into balance.
