Quantitative easing (QE) is a form of monetary policy in which a central bank, like the U.S. Federal Reserve, increases the size of its balance sheet by purchasing securities from the open market.
QE is a tool central banks use to increase the money supply and lower interest rates. A central bank pursuing QE usually buys government bonds, corporate bonds, or mortgage-backed securities. QE typically lowers borrowing costs, encourages lending and investment, and stimulates economic growth.
