What is quantitative easing?
Understand the Problem
The question is asking for an explanation of quantitative easing, a monetary policy tool used by central banks to stimulate the economy.
Answer
Quantitative easing (QE) involves central banks buying securities to reduce interest rates and increase money supply.
Quantitative easing (QE) is a monetary policy strategy used by central banks where they purchase securities to reduce interest rates, increase the money supply, and encourage lending to consumers and businesses.
Answer for screen readers
Quantitative easing (QE) is a monetary policy strategy used by central banks where they purchase securities to reduce interest rates, increase the money supply, and encourage lending to consumers and businesses.
More Information
Quantitative easing is generally used during periods of low inflation and low interest rates to stimulate economic growth. It's a non-traditional monetary policy since it shifts away from typical interest rate targeting.
Sources
- Quantitative Easing (QE): What It Is and How It Works - Investopedia - investopedia.com
- Quantitative easing | Bank of England - bankofengland.co.uk
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