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Central Banks Borrowing Skyrockets to Offset Recession
May 10, 2020
Protecting an economy from a pandemic isn’t cheap, and central banks are going to buy a lot of their governments’ debt. The US Federal Reserve’s assets are skyrocketing, for instance, and the balance sheets at the ECB and Bank of Japan look pretty similar. Around the world, central bank asset purchases are expected to reach $6 trillion this year.
Figure 1. Federal Reserve Total Assets
May 10, 2020
Protecting an economy from a pandemic isn’t cheap, and central banks are going to buy a lot of their governments’ debt. The US Federal Reserve’s assets are skyrocketing, for instance, and the balance sheets at the ECB and Bank of Japan look pretty similar. Around the world, central bank asset purchases are expected to reach $6 trillion this year.
Figure 1. Federal Reserve Total Assets
Source: St. Louis Federal Reserve
Figure 2: Change in US Retail Spending March’20 vs. March’19
Source: US Census