Benchmark
QE Works But Not Forever, BIS Study Tells Central Banks
Investors increasingly price in bond purchases ahead of their announcement, reducing their effectiveness
Fitch Ratings' McCormack on Global Sovereigns Outlook
This article is for subscribers only.
The benefits of central banks pumping money into the economy by buying securities diminish over time, according to a BIS paper.
That’s the conclusion of a Bank for International Settlements Working Paper by Henning Hesse, Boris Hofmann and James Weber, who compared the effects of the asset purchases in the U.S. and the U.K. conducted between 2008 and mid-2011 with those thereafter. While the earlier actions significantly helped the economy, they said, the subsequent ones had little or no impact.