, Columnist
Central Banks Won't End the Party Soon
The Fed, Bank of England, European Central Bank and Bank of Japan will keep up asset purchases.
Don't take away the punch bowl.
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In response to the 2008 financial crisis, major central banks adopted extraordinary measures to stabilize the global system and revive growth. These measures included the maintenance of near-zero interest rates by the Federal Reserve for seven years, and a quintupling of its balance sheet over that period through bond purchases.
This process, known as quantitative easing, was also a key part of policies followed by the Bank of England, the European Central Bank and the Bank of Japan. The latter institutions also reduced deposit rates to negative levels that meant that commercial banks had to pay them to hold their deposits.