The objectives of monetary policy over the medium term primarily focus on maintaining price stability, which means keeping inflation low, stable, and predictable, typically around a target rate such as 2% inflation. This objective is considered the best contribution monetary policy can make to sustainable economic growth and job creation

. Beyond price stability, monetary policy also aims to:

• Support maximum or full employment by fostering conditions that promote job creation and reduce unemployment

• Promote moderate long-term interest rates to ensure financing conditions conducive to economic growth

• Regulate the money supply to balance credit expansion and contraction according to economic needs, thus controlling inflation and supporting growth

• Manage aggregate demand to align with aggregate supply, influencing economic activity and employment levels

• Support financial stability and exchange rate stability as part of broader economic policy goals, especially in integrated economies like the euro area

• Encourage savings and investment by influencing interest rates and inflation expectations

Central banks implement these objectives using tools such as setting policy interest rates, open market operations, and reserve requirements, adjusting these instruments to influence financing conditions, credit availability, and overall economic developments

. In summary, the medium-term objectives of monetary policy are to maintain price stability, support employment, moderate interest rates, and ensure overall economic and financial stability to foster sustainable economic growth