Quantitative easing is when a central bank buys large amounts of bonds to push down long-term interest rates and support the economy.
The Fed used QE after the 2008 financial crisis and during the 2020 pandemic. The reverse, letting bonds roll off or selling them, is called quantitative tightening (QT).
Why it matters to you
QE tends to lower mortgage and other long-term rates; QT tends to push them up.
FAQ
What is Quantitative easing?
Quantitative easing is when a central bank buys large amounts of bonds to push down long-term interest rates and support the economy.
What is quantitative tightening?
The opposite of QE: the central bank shrinks its bond holdings, which tends to push long-term rates up.
