- François Dupuis, Vice-President and Chief Economist • Mathieu D’Anjou, Senior Economist
Post-crisis monetary policies - Part 2
Recourse to large-scale purchases of financial securities constitutes one of the central banks’ principal innovations following the 2008–2009 financial crisis. While the purchases proved effective in supporting financial markets during the crisis, and in lowering interest rates, their positive effects on the economy and inflation are uncertain. Such purchases also create enormous distortions in the financial markets, distorsions that could have serious long-term consequences; therefore, central banks must be very cautious in resorting to them and would likely be well advised to limit massive securities purchases to crisis situations.
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