THE QUANTITATIVE EASING POLICY IN THE USA AND EU: SPECIFIC FEATURES, RISKS, AND PROSPECTS

Abstract

The unconventional monetary policy also known as “quantitative easing” (QE) continues to expand in attempts to overcome the consequences of the current financial crisis. Introduced on the developed markets, QE had noticeable influence on the emerging markets as well. Consequences of this policy for the developed countries and its transborder influence on the emerging markets are the outstanding topic to discuss by the scientific community.
The actual experience of realization of the QE policy in the USA demonstrated its efficiency in the stabilization of the banking system, minimization of financial losses, and reducing the interest rate. The considerable volumes of liquidity, which were issued on the developed markets and moved onto the emerging markets, by creating the threat for their financial stability, became a side effect of the QE policy.
Across the long time of the crisis, being rather afraid of a debt crisis and increasing the inflation, ECB tried to abstain from the QE policy. Only after a change of the ECB board and realizing the threat of deflation and the present liquidity trap in EU, ECB has turned to QE. European markets have glut of the liquidity and assets with the constant growth of negative incomes. Main prospects of the QE policy in EU under these conditions are: euro devaluation, which can support European producers, and the refinancing of governments and corporations, which will bring down their debt load.
Consequences of the QE policy realized in the USA had a limited influence on Ukraine due to the weak integration and moderate attractiveness of the Ukrainian economy for investors. The QE policy started by ECB potentially can make a greater influence. Strengthening the integration with the EU countries promotes the potential availability of the capital issued in EU.