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World Reaction Brazil The quantitative easing creates excessive liquidity, which flows to countries such as Brazil Germany These policies would not help but create more troubles China Fed stimulus might have a negative impact on the global economy European Central Bank Europe's central bank views the current rate in the euro zone as appropriate Emerging Economies Emerging economies expressed displeasure at the Fed's move

Teeming With Liquidity Consumer prices are running high and property prices have exceeded pre-crisis levels. But the situation is far from hopeless More Money, More Problems The quantitative easing will lead to torrent capital inflows into emerging markets and create asset bubbles that could destabilize the world economy Reacting to QE2 To resist the temblor caused by QE2, China is keeping a close eye on international markets and solidifying its financial position U.S. Monetary Policy a Global Threat The U.S.'s latest attempt to bolster its sagging economy poses danger for the economies of developing nations around the world more

Background   What is QE2? Quantitative easing (QE) is a monetary policy used by some central banks to increase the money supply by increasing the excess reserves of the banking system. This is usually accomplished by purchasing the central government's own bonds to stabilize or raise their prices. This results in lower long-term interest rates. This policy is used when other methods to control the money supply have failed Related Special Reports

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