The impact of unconventional monetary policy on emerging market economies The global increase in liquidity, following the launch of widespread quantitative and qualitative easing programmes, or the unconventional monetary policy, by several advanced economies played an important role in preventing the Great Recession from degenerating into a Great Depression, and more recently, has been used to counter the possible unanchoring of inflation expectations in the face of deflationary conditions.
In addition to identifying these particular strains in the banking sector, our regular economic and monetary analysis has indicated that the intensified financial market tensions continue to dampen economic activity in the euro area and the outlook remains subject to high uncertainty and substantial downside risks.