Interview with Andrew Bailey, Governor of the Bank of England, on Q.E.

The video discusses the role of quantitative easing (QE) in achieving inflation targets, comparing the economic effects of different QE amounts. It highlights the impact on financing costs and liquidity. The discussion also covers the future of monetary policy tools, including yield curve control and negative rates, emphasizing the need for central banks to adapt and evaluate various tools beyond traditional interest rate adjustments.

Why was a QE of 150 chosen over 100?

• To increase interest rates

• To reduce market expectations

• To decrease liquidity in the economy

• To meet the inflation target sustainably

How does QE impact the economy?

• By decreasing asset consumption

• By affecting the interest rate curve

• By reducing liquidity in the economy

• By increasing the cost of financing

What is one of the effects of QE on assets?

• It decreases investment opportunities

• It increases the liquidity of assets

• It makes assets less liquid

• It removes liquid assets from the economy

What new tool is being considered for monetary policy?

• Fixed exchange rates

• Increased QE

• Yield curve control

• Higher interest rates

What has changed for central banks in recent times?

• They no longer use QE

• They have more tools to choose from

• They focus only on interest rates

• They have fewer tools available