Monetary economics is a branch of economics that focuses on the role of money in the economy. It studies how money supply, interest rates, and inflation affect economic activity. Central banks, like the Federal Reserve in the United States, use monetary policy to manage the economy by controlling the money supply and influencing interest rates. This field also examines how changes in monetary policy can impact employment, production, and overall economic growth. By understanding these relationships, policymakers can make informed decisions to promote stability and growth in the economy, addressing issues like recession and hyperinflation.