Fed's quantitative easing not working effectively: IMF economist

2011-02-11 16:16:20 [ Big Normal Small ]    　Comment

NEW YORK, Feb. 10 (Xinhua) -- The quantitative easing monetary policy implemented by the U.S. Federal Reserve had not brought expected benefits for the U.S. economy, a former International Monetary Fund (IMF) chief economist said Thursday.

The function of the Fed monetary policy adopted in November 2010 to boost the U.S. economy "is relatively limited," Raghuram Rajan told a forum held here by the Council on Foreign Affairs.

"The biggest problem in some sense is that the Fed's monetary policy actions are essentially transmitted to the rest of the world, when the rest of the world doesn't allow their exchange rates to move and protect their own monetary policy and keep that as a separate policy as its own."

He said the consequence is the appearance of inflation of commodities across the world.

In November, the Fed announced it would buy 600 billion U.S. dollars more in Treasury bonds to boost the sluggish economic growth.

Before that, it had purchased about 1.7 trillion dollars in U.S. government debt and mortgage-linked bonds to stimulate the economy.

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