Thus, the government is able to raise funds at almost zero or an extremely low cost. The cost for the private sector of raising funds has also declined. 4  BIS Review 29/2003  However, despite drastic monetary easing by the Bank, economic activity and price developments have not been influenced much so far. This is due to various factors.
Due to its importance for Mexico, my comments will focus on the United States, notwithstanding the fact that other countries like the United Kingdom and the European Monetary Union have adopted similar actions. How effective have central bank policies been and what are their limitations? In the wake of recent experience, two periods must be identified.