Moreover, several non-standard monetary policy measures were taken to bolster the transmission of low policy rates in the face of persisting market tensions. In 2015 there were serious concerns that the euro area could slide into a deflationary spiral, a selfreinforcing spiral of falling prices and output. Against this backdrop, in 2015 the ECB introduced quantitative easing, QE, to provide further monetary policy accommodation.
By lowering long-term interest rates, QE has helped to further loosen financing conditions for households and businesses. This in turn should have a positive impact on their spending decisions and, ultimately, on inflation. Rebalancing necessity, effectiveness and risks When deciding on monetary policy measures such as QE, decision-makers typically assess policy options along three dimensions: necessity, effectiveness and side effects.