The Federal Reserve's actions that are designed to influence the availability and cost of money. Specific policy includes changing the discount rate, altering bank reserve requirements, and conducting open market operations. In general, a policy to restrict monetary growth results in tightened credit conditions and, at least temporarily, higher rates of interest. This situation can be expected to have a negative impact on the security markets in the short run, although the long-run effects may be positive because of reduced inflationary pressures. Compare accommodative monetary policy.