By keeping market interest rates low, the policy encourages companies to invest in hiring and business expansion, and it encourages households to spend more. The Committee has announced that it anticipates that conditions will be such that the fed funds rate will stay between 0 and 25 basis points for at least 20 more months. The second kind of accommodation is less conventional.
In terms of investing in China’s bond markets, the Bank of Lithuania has been one of the pioneers among the central banks in Europe and beyond. We have also recently become the managers of the ECB’s renminbi portfolio. I suspect this is the main reason why I was invited to this summit.