Student’s Name
Institution Affiliation
 
 
 
 
 
 
 
Monetary Policies
Table 1: Effect of Monetary Policies on U.S. Macroeconomic situation from 2000 to 2010

Period in Years Fed Rates, Reserve Rates and Open market operations
2000 –          Raised rates to 5.5% from 5.0% which resulted into decreased inflation to 2.7%, increased GDP to 4.7% and contributed to unemployment of 6%.
2001 –          Fed rates were l
–          owered to combat recession that resulted from the Afghanistan war and confront the effects of the September 2011 attacks.
–          Increased open market operation resulting into induced funds into the economy.
–          Reserve rates were reduced leading to increasing borrowing.
2002 –          Reduced rates to 1.25% leading to increased prices in treasury bonds, increase in growth of productivity and falling in stock prices.
–          Increased GDP growth to 1.8%
–          Unemployment remained unchanged at 6% while inflation increased to 2.4%.
2003 –          Reduced rates to 1.25% leading to increased prices in treasury bonds, increase in growth of productivity and falling in stock prices.
2004 –          Sustained rates to 1.25%. Reduced the subprime mortgage crisis
–          Helped stimulate economic growth through funding, contributing to growth in GDP.
2005 –          Raised rates. Resulted into reduced borrowing.
–          Led to reduced inflation rate to 3.4%.
–          GDP growth increased to 3.3%.
2006 –          Raised rates to 5.25%. Helped combat housing bubble.
–          Led to reduced borrowing.
–          Unemployment remained at 6%.
–          GDP growth rate reduced to 2.4%
2007 –          Reduced rates to 4.25%. Led to reduced housing sells. Increased inter-bank rates on loans.
2008 –          Reduced rates to 0.25%. Led to tax rebate and increased borrowing.
–          Inflation was reduced to 0.1% and led to increased GDP from -0.3% to 2%.
–          Unemployment remained unchanged at 6%.
2009 –          Reduced rates to 0.25%. Led to tax rebate and increased borrowing.
–          Employment increased to 12%, unemployment remained constant at 6%.
2010 –          Reduced rates to 0.25%. Led to tax rebate and increased borrowing.

Source: Federalreserve.gov. (2017).
References
Federalreserve.gov. (2017). Monetary policies. Retrieved from: https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.html