You have 2 types of monetary policies: contractionary and expansionary policies. 
The government can use 3 tools to regulate the economic developments within a economie.

Those are RRR (required reserve ratio), discount ratio and OMO (open market operations). 

 

The ECB's (EU) objectives are pricestabilty with a percentage of  about 2% inflation rate 

The FED's (US) objectives are maximum employement, stable prices and moderate long-term interest rates. 

 

RRR: when R it is contractionary 
           when R it is expansionary 

Discount ratio: when DR it is contractionary 
                      when DR it is expansionary

Federal funds rate is borrowing from other commercial banks 

OMO: Open market sales (the bank lends out less money to the commercial banks) is contractionary 
         Open market purchase (the bank lend out more money to the commercial banks) is expansionary