Since the financial crisis in 2008,
Central banks are responsible for the monetary policy within a certain currency zone (e.g. the European Central Bank (ECB) in Frankfurt for the euro zone). They inter alia refinance commercial banks and watch the stability of the price level and the monetary value.
and economists in Europe, America, Japan and the UK have introduced 2 largely experimental economic policies – ultra-low interest rates and
Quantitative Easing, or QE.
QE is a way of injecting money into the economy. Central banks buy bonds from banks and other financial institutions, improving their balance sheets, in the hope that they will increase their lending to people and businesses stimulating economic growth.
They have done this, they say, to boost economic growth. If struggling economies are injected with new money, goes the thinking, demand will rise, increasing the consumption of goods and services. This will create new jobs, which will reduce inequality and kick off a virtuous cycle, putting the economy back on a healthy and sustainable path.