As a result, there will be an effect that spills over to domestic economic activity and prices through an increase in exports to the emerging economies and an improvement in profits of global firms. The third is about the effect through the expected rate of inflation.
This is the effect that, in addition to the existing channel of influencing demand, by attaching an expectation that a central bank’s balance sheet will expand for a protracted period, the expected rate of inflation will rise and real interest rates will decline, thereby affecting economic activity and prices.