Statistical data reveals that the largest Central Banks have printed around $25 Trillion cash since the year of 2008.

Back when the major financial crisis occurred in the year 2008, the United States Federal Reserve launched the Quantitative Easing Program, which is basically a variant of monetary policy, in which central banks are required to purchase financial assets for the long term, in order to increase the money supply and promote economic activity.

Problems with QE and Inflation

According to Ben Bernanke from the Federal Reserve, “the problem with Quantitative Easing is that it” comes in handy “in practice, but it doesn’t work when it comes to the theory.” Another issue is inflation. Central Banks might be forced to get rid of their policies if inflation continues to grow.

The Federal Reserve has been in favor of an increase in inflation and will also resist pushing out increases in interest rates. This idea has been examined multiple times, especially in the event of the COVID-19 Pandemic and many others. Information from sources has also revealed that the U.S. has witnessed the largest consumer price index readings in 30 years, recorded just last month. The CPI reading reached about 0.9%, highlighting a 6.2% increase over the years.

Central Banks Pushing QE Programs

From its launch date till now, Central Banks have experienced some quite drastic changes in their operations. According to the data shared by the Atlantic Council, Central Banks worldwide, including the U.S. Federal Reserve, Central Bank of Europe, and many others, have printed Trillions of dollars, bringing nearly $25Trillion into the global economy, with around $9Trillion being forcefully pushed just because of the ongoing COVID-19 pandemic.

Central Banks Buffing Balance Sheets

Central Banks are now having quite a tough time because of the huge amount of asset purchases coming in response to the falling economy. The COVID-19 pandemic has especially taken quite the heavy toll on Central Banks, forcing these Banks to work on Quantitative Easing, bringing more than $9Trillion to keep their economies intact and preventing the international financial market from collapsing. Data from the Atlantic council also shows that around four of the prime Central Banks operating worldwide have their balance sheets swollen up by nearly 60% since the start of last year.

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