Quantitative easing (QE) is a dovish monetary strategy imposed by a central bank to increase the money supply in an economy by purchasing long-term securities on the open market. The central bank’s objective is to stoke growth and investment when the interest rate is at or near zero.

QE is an alternative monetary policy used when the usual open market operations are not functioning as they should be. There is sometimes a danger that it will cause inflation and fall short of its impact on growth.