Time to stop handing out the pills: the great QE detox
We are facing a serious inflation threat that will test the resolve of central bankers, writes Jagjit Chadha
The invention and then innovation of quantitative easing (QE) has been a response to financial crises, first in Japan and then across the advanced economies of the world. As policy rates moved towards their effective lower bound, an alternate way of influencing monetary and financial conditions needed to be adopted.
The contemporaneous issuance of large quantities of government debt gave central banks the chance to influence the price of this larger pool of assets by draining the market of some
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe
You are currently unable to print this content. Please contact info@centralbanking.com to find out more.
You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@centralbanking.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@centralbanking.com
More on Unconventional monetary policy
ECB economists highlight smooth quantitative tightening
Foreign investors are largest euro area securities holders, but households are buying more
The BoJ’s possible path to positive rates
Are market expectations about a spring shift from negative Japanese rates credible, asks Sayuri Shirai
Central banks should co-ordinate policy – Minneapolis Fed paper
Policy-makers should consider decisions’ effects on world real rate, authors say
BoJ’s Himino highlights benefits of ending negative rates
Deputy governor says there has been "solid progress" in firms’ price and wage-setting behaviour
Defending the basis
Benefits of additional Treasury liquidity may outweigh potential intervention costs during a hypothetical panic, writes Joseph Wang
BoJ scraps rigid bond yield cap
Central bank further loosens YCC, ends daily bond buys and raises inflation forecasts
The predicament of bloated central bank balance sheets
Swollen balance sheets carry significant risks for combating inflation, ensuring financial stability and preserving central bank credibility, independence and effectiveness. How can central banks reduce them?
Bank of Japan steps up bond purchases
Central bank faces pressure to raise rates as yields on 10-year government bonds rise