Quantitative easing - impact on currency exchange rates

What impact does quantitative easing have on currency exchange rate of a country ?
09 May 2020 at 04:49 PM
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torrstorrs
Quantitative easing is a form of monetary policy, in which central bank purchases longer-term securities from the market. Central banks use it as a method to quickly increase the domestic money supply, boost economic activity, encourage lending and investment.

When central bank increases the money supply, it will have several short-term and long-term impacts on country's economy. For example, it will most probably create and inflation. In case of currency, the quantitative easing often tends to depreciate a country's exchange rates in relation to other currencies.
31 May 2020 at 02:07 PM
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BenBen
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