Monetary Easing

Monetary Easing

The policy in which a central bank lowers interest rates and deposit ratios to make credit more easily available. This makes borrowing easier for businesses, which stimulates investment and expansion of operations. The immediate result of monetary easing is generally a boost in stock prices. In the medium term, it promotes economic growth. However, if this policy remains for too long, it can lead to a situation in which there is a glut of currency or too many dollars chasing too few goods and services, leading to inflation. For this reason, most central banks alternate between policies of monetary easing and monetary tightening to encourage growth while keeping inflation under control.
References in periodicals archive ?
Global Banking News-November 4, 2015--Hungary to use non-conventional tools for monetary easing
TOKYO, Feb 18 (KUNA) -- Japan's central bank decided Wednesday to maintain its current monetary easing measures and left unchanged its assessment of the country's economy.
The latest monetary easing by European Central Bank (ECB) has seen the bank pushing deposit rates into the negative zone last week.
The BOJ's monetary easing "is exerting desired effects steadily and the Japanese economy smoothly follows a path to achieve the 2 percent price stability target," Kuroda said in a statement the BOJ issued after a quarterly meeting of the central bank's branch managers.
Economists say further monetary easing would be required to counteract the negative effects of the tax hike on companies -- the Shinzo Abe government is expected to announce a stimulus package worth $50bn or more.
5 per cent year-on-year in the first quarter, more than widely predicted, the government said Thursday, crediting its aggressive monetary easing programme.
Summary: International Monetary Fund (IMF) officials say they are watching carefully for signs that massive flows of cash unleashed in world markets by unprecedented monetary easing might lead to asset bubbles, or to overheating in some emerging markets.
Summary: Mumbai: India's rupee snapped a three-day losing streak on optimism monetary easing by global .
Group of 20 finance chiefs started a two-day meeting Thursday night in Washington, with Japan seeking to address possible concerns about its bold monetary easing and the yen's recent steep fall, as well as its potential negative impact on other economies.
Korea), June 14 (Xinhua-ANI): Bank of Korea (BOK) Governor Kim Choong-soo said Thursday that monetary easing in advanced nations will have negative spillovers to emerging economies.
The Arab states, particularly in the oil-rich GCC region, stand to benefit from the Federal Reserve's quantitative monetary easing.
Rather, it is an inadvertent and inevitable result of a series of snowballing factors that can be traced back to the Bank of Japan's post-bubble monetary easing.