Economics

Here’s why thickening balance sheets may work against central bankers

The Federal Reserve, European Central Bank and Bank of Japan have collectively expanded their balance sheets by around $8trn in 2020. It took them almost eight years to achieve the same growth following the seizure of global financial markets in September 2008.

That burst of bond-buying has revived a debate about quantitative easing, and how it might impose a fiscal cost on the countries pursuing it. But the circumstances in which to worry look fairly limited.

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