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Will Quantitative Easing and a strong economic recovery lead to high inflation?

Monday 15 March 2021

On Tuesday 16 March 2021 two panels of witnesses will be giving evidence to the House of Lords Economic Affairs Committee’s inquiry on Quantitative Easing (QE).

These evidence sessions will be held remotely and streamed on Parliament TV.

At 3:00pm the Committee will hear from:

  • Adam Posen, President of the Peterson Institute for International Economics
  • Kenneth Rogoff, Professor of Economics and Thomas D. Cabot Professor of Public Policy, Harvard University.

At 4:00pm the Committee will hear from:

  • Lord Turner of Ecchinswell, Senior Fellow and Grantee, Institute for New Economic Thinking
  • Charles Goodhart, CBE, FBA, Emeritus Professor of Banking and Finance with the Financial Markets Group at the LSE.

Question they are likely to face include:

  • How much has QE affected the exchange rates of the countries where it has been implemented?
  • Will the Biden stimulus, combined with loose monetary policy, lead to excess inflation?
  • Could QE undermine the independence of central banks?
  • How does the Fed’s QE programme effect policy decisions taken by the Bank of England, and vice versa?
  • Has QE has distorted market incentives and potentially enhanced inequality?
  • How likely is it that inflation will return in the UK, and how does this relate to the future of the Bank’s QE programme?
  • Should the Bank be actively considering alternative versions of QE?
  • What are the advantages and disadvantages of using alternative monetary policy tools, such as ‘helicopter money', over more orthodox approaches which aim for stable monetary policy and expansionary fiscal policy when necessary?

More on this inquiry

The committee is examining Quantitative Easing in the context of the Bank of England’s operational independence, its accountability and the transparency of its decision-making. It is also considering the economic effects of Quantitative Easing, what risks are entailed, its distributional impacts and the future of the programme.

Two weeks ago the Committee took evidence from BlackRock, Allianz and the former Chancellor of the Exchequer, Lord Darling of Roulanish. You can watch the sessions back on Parliament TV.

More on the Economic Affairs Committee

The Economic Affairs Committee is one of the five permanent investigative committees in the House of Lords and is charged with considering economic affairs.

Committee Website

Twitter - @LordsEconCom

 

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