The main distinction between fiscal and monetary policy is that fiscal policy involves government decisions regarding spending and taxation to influence the economy, while monetary policy involves actions taken by a central bank to control the money supply and interest rates to achieve economic goals. Fiscal policy is determined by elected officials in the government, while monetary policy is typically set by a central bank, such as the Federal Reserve in the United States. Fiscal policy affects the overall demand in the economy, while monetary policy primarily affects the supply of money and credit.
