Fine-tuning monetary policy

The fine-tuning of monetary policy is, first of all, an attempt by a central bank to influence the course of the economy as precisely as possible by means of monetary policy measures towards a specific growth target. Every fine-tuning of monetary policy is characterized by numerous changes in the key interest rate. However, it is controversial whether the economy can be systematically influenced by monetary policy at all.

Secondly, monetary policy fine-tuning is the effort to compensate for fluctuations in liquidity, which the central bank believes are too strong, by quickly injecting or withdrawing money from the market. This type of monetary fine-tuning is practiced by all central banks, especially in times of great uncertainty.

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