Discussing how external vulnerabilities had implications for emerging markets
Quantitative easing is an unconventional monetary policy in which a central bank purchases government bonds or other financial securities from the market in order to inject liquidity directly into the economy by increasing the money supply.
Sarb Governor Lesetja Kganyago on Friday referred to former Brazilian finance minister Guido Mantega, who popularised quantitative easing as “currency wars”.
He said continued quantitative easing in rich countries could lead to more vulnerabilities in emerging market economies and that central banks should deploy macro-prudential tools to address these vulnerabilities.
In June, ANC secretary-general Ace Magashule was reprimanded after saying that the party’s National Executive Committee had asked the government to appoint a task team to explore quantitative easing.
Source: iol.co.za
