Fiscal policy is the use of government spending and taxation to influence the economy. It is a sister strategy to monetary policy, where a government or central bank influences an economy by adjusting the nation's money supply. Governments typically use fiscal policy to promote strong and sustainable growth, reduce poverty, and stabilize the economy. It involves adjusting spending levels and tax rates to influence a nation's economy, with the objective of influencing macroeconomic conditions such as aggregate demand, employment, inflation, and economic growth
. Fiscal policy is often contrasted with monetary policy, which is enacted by central bankers and not elected government officials
