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Old 4 August 2022, 12:50 PM   #1
The Londonist
"TRF" Member
 
Join Date: Oct 2020
Location: London
Posts: 181
Did QE Cause Inflation?

Having read a number of explanations about how QE (Quantitative Easing) works, I initially concluded that it “only” caused asset price inflation by driving down long term bond yields in the developed world (US, EU, UK and Australasia).

Now the assertion in the mainstream media is that QE is one of the causes of the current bout of high inflation.
(I’m not sure whether significant QE was used to provide the monetary stimulus to cushion the CV19 pandemic but I understood that money printed via QE only went to banks as payment for bonds rather than payment directly to taxpayers.)

The growing narrative that central banks are either partly or completely responsible for the high inflation levels is also challenging to refute without unbiased deep understanding of the causes. It seems as if the central banks are easy targets.

Can anyone on TRF from a major financial institution/bank/private equity background shed some light on the causes of inflation from major financial institutions’ perspectives please?

Thanks in advance.
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