How money supply affects interest rates?

The money supply refers to the total amount of money available in an economy at a given time. When the money supply increases, the demand for money decreases, causing interest rates to fall. Conversely, when the money supply decreases, the demand for money increases, causing interest rates to rise. Central banks, such as the Federal Reserve in the United States, use monetary policy to control the money supply and influence interest rates to achieve economic goals.

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