What is quantitative easing?
Understand the Problem
The question is asking for an explanation of the term 'quantitative easing', which refers to a monetary policy used by central banks to stimulate the economy by increasing the money supply. It often involves the purchase of government securities to inject liquidity into the economy.
Answer
Quantitative easing (QE) is a monetary policy where central banks purchase securities to reduce interest rates, increase the money supply, and encourage lending.
Quantitative easing (QE) is a monetary policy where central banks purchase securities to reduce interest rates, increase the money supply, and encourage lending.
Answer for screen readers
Quantitative easing (QE) is a monetary policy where central banks purchase securities to reduce interest rates, increase the money supply, and encourage lending.
More Information
Quantitative easing involves central banks, like the Federal Reserve, purchasing government bonds or other securities to lower long-term interest rates and increase money supply which, in turn, encourages lending to consumers and businesses.
Sources
- What Is Quantitative Easing? - Forbes - forbes.com
- Quantitative easing | Bank of England - bankofengland.co.uk
- Quantitative Easing (QE): What It Is and How It Works - Investopedia - investopedia.com
